LocalBitcoins Popular. Wire transfers to these exchanges are more expensive, but often more reliable and there is significantly more market depth. You can fund your exchange account online via bank transfer. In Hong Kong, where and how to buy Bitcoin has changed rapidly in the last few years.
Bitcoin ATM launched in Hong Kong
Updated: version history. In general, Hong Kong has a reputation as a reliable and predictable non-interventionist regulator. Most rules are clearly laid out and easy to comprehend and follow for people with little legal training like me. Rules rarely contradict each other and while government agencies do not closely coordinate with each other or share common goals, there are few power plays and power grabs between different agencies and departments. However, some license regimes are restrictive and tied to control over real estate, which makes them only accessible to an oligopolistic cartel of property developers. Other licenses are no longer given out and have to be bought from existing license holders.
The Regulatory Environment
Sam Glaser: The world seems to pretty excited. We sold over 50 machines within the first 50 days of accepting orders. TC: Tell me about yourselves. SG: We are a small team of hungry, dedicated and determined technologists based in Las Vegas. Our team is laser focused on proliferating Robocoin around the globe and providing an onramp for bitcoin overall. TC: What are your numbers in Vancouver?
Buying Bitcoin in Hong Kong
Updated: version history. In general, Hong Kong has a reputation as a reliable and predictable non-interventionist regulator. Most rules are clearly laid out and easy to comprehend and follow for people with little legal training like me. Rules rarely contradict each other and while government agencies do not closely coordinate with each other or share common goals, there are few power plays and power grabs between different agencies and departments.
However, some license regimes are restrictive and tied to control over real estate, which makes them only accessible to an oligopolistic cartel of property developers. Other licenses are no longer given out and have to be bought from existing license holders. The result of this means that while Rule of Law and Free Market Principles prevail in Hong Kong, markets are highly duopolized and uncompetitive.
While Bitcoin in general is not specifically regulated other existing regulations might apply and the above mentioned realities shape Bitcoin markets and businesses in Hong Kong. It is important to understand the political and economical limitations and obscurities of Hong Kong to understand how Bitcoin fits in. Sadly this greatly exceeds the scope of this article. Bitcoin did not get onto the radar of the Hong Kong regulators until late Until then there was little Bitcoin activity in Hong Kong.
Bitfinex was likely the first exchange to open bank accounts in Hong Kong and offering exchange and trading services largely to international customers in In this article Tsang gives a good summary of how Bitcoin works and warns about its volatile nature and the lack of support from a state or issuer.
He warns of a bubble bursting bitcoin atm hong kong charge sees many opportunities for software developers. Being defined as a virtual commodity rather than a currency, Bitcoin is per se not regulated by any of the financial regulatory bodies, such as the HKMA or the SFC.
Trading activities are controlled by the Customs and Excise Departmentincluding commodities trading. What this means precisely for Bitcoin trading remains unknown.
The only guidance available is a document from the Customs and Excise Department from January 30, In short, people dealing with Bitcoin might have a duty to:. The document may be interesting as a reference point. Most notably, the Legislative Council refers to Bitcoin as a virtual currency in their research publication. Councillors frequently e. This terminology puts it more in line with international organizations and in our bitcoin atm hong kong charge does not represent a policy shift.
On November 1,the Chief Executive Officer of the SFC, Ashley Alder, announced in a keynote speech at Fintech Week the strict enforcement and clarification of existing rules, as well as a sandboxing arrangement for cryptocurrency exchanges.
Together with this speech, the SFC released two appendices that attempt to govern the rules of cryptocurrency funds and exchanges. The intention of these rules and publications are difficult to understand, as they appeared relatively abruptly and without a clear goal. They do not represent law or introduce new regulation.
A fund that only invests in cryptocurrencies and not in futures or securities does not need a type 9 license asset management. If it however distributes such a fund in Hong Kong it requires a type 1 license.
The SFC however expects that a fund holding cryptocurrencies behaves as if it held securities or futures. The SFC will also be interested in the security arrangements of such a fund, custodial arrangements or insurance. The clarifications are trying to limit the cryptocurrency exposure of funds, and keep it off limits for retail investors. It is also trying to heavily disincentivize funds from holding too much cryptocurrency. If you are running a fund, consult a lawyer about whether you need a license to operate in Hong Kong.
The SFC only regulates those exchanges that give investment advice, trade futures or on margin. Exempt from this sandbox are all currently viable business models, including spot exchanges, Bitcoin ATM providers, OTC exchanges that deal with non-professional investors, margin, derivatives and futures exchanges and those trading ICO tokens. The only type of exchange qualifying for the sandbox is an OTC exchange serving institutional customers.
If you are running a fund offering investment advice, futures, derivatives, margin or trading ICO tokens, consult a lawyer about whether you need a license to operate in Hong Kong. For a more comprehensive article about Bitcoin Taxation, please refer to this article. Income tax needs to be paid independent of whether payments are made in cash, cheque or Bitcoin and it is generally up to a business if they want to do their accounting in Hong Kong Dollars or Bitcoin.
Article of the Basic Law states:. The Hong Kong dollar shall be freely convertible. Markets for foreign exchange, gold, securities, futures and the like shall continue. The article however does not prevent the government from creating licensing regimes that favor monopolies and allow for significant rent seeking. The concern behind this is that Bitcoin exchanges might apply for MSO licenses and use them to create an illusion of legitimacy or government sanction.
This puts police intimidation as the number one legal barrier to offering Bitcoin products. Companies outside of that regime do not feel restricted or intimidated in offering Bitcoin products. In reality banks are highly hesitant to open accounts to financial services companies, and even more so cryptocurrency businesses.
There are few reports of private banks accounts being shut down due to involvement with Bitcoin trading, but for company accounts this remains common. Currently there is no dedicated Bitcoin payment processor active in Hong Kong. Hong Kong exchanges offer such services only on a limited on-demand basis. Whether Bitcoins are used or not is not relevant to the issuance of a license, and money lenders using Bitcoin have successfully obtained licenses.
Securities law is incredibly complicated and Blockchain-based product are not excempt. Whether a cryptocurrency is a commodity or security, and whether a security is a legal security requires very careful examination. It however currently seems unlikely that the SFC will go after securities not specifically offered or advertised to Hong Kong investors.
ICO issuers were also contacted. They either stopped their ICO or promised to comply with securities regulation. Advising on token offerings, brokering tokens and letting customers trade them may require a license from the SFC. All usual due diligence, information and investor warnings apply. Bitcoin will likely become more regulated as it becomes more popular. The SFC will further relax its rules towards funds, and later also derivatives and futures trading and enable its existing license holders to offer these products based on cryptocurrencies.
Possibly ETFs and other funds will become possible and even listed. I expect it to take a long time until the Hong Kong government reclassifies Bitcoin as a currency, which will allow the HKMA to clarify its rules, allow banks to offer Bitcoin-based investment products as well as allow SVF license holders to include Bitcoin into their products. This post was written by Leonhard Weese, and for obvious reasons does not constitute legal advise.
For corrections, suggestions and inquiries contact the author via LeoAW or leo at bitcoin dot org dot hk. Hong Kong, rule of law and the free market Updated: version history In general, Hong Kong has a reputation as a reliable and predictable non-interventionist regulator.
In short, people dealing with Bitcoin might have a duty to: obtain information on the customer and keeping it up to date obtain information on the business relationship, the source of wealth and source of funds monitor the business relationship make reports to the Financial Intelligence Unit about suspicious activity While not carrying legal status, the Joint Financial Intelligence Unit JFIU references a report by the Paris-based Financial Action Task Force FATF on cryptocurrencies.
Bitcoin as a Virtual Asset On November 1,the Chief Executive Officer of the SFC, Ashley Alder, announced in a keynote speech at Fintech Week the strict enforcement and clarification of existing rules, as well as a sandboxing arrangement for cryptocurrency exchanges. Taxation For a more comprehensive article about Bitcoin Taxation, please refer to this article.
Tokens Securities law is incredibly complicated and Blockchain-based product are not excempt. Notes This post was written by Leonhard Weese, and for obvious reasons does not constitute legal advise.
The Regulatory Environment
OKCoin is the largest Bitcoin exchange bitcoin atm hong kong charge China. Therefore the safety of your funds is primarily dependent on their security systems. Changelly Buy Bitcoin Changelly knog you buy bitcoin with Litecoin, Dogecoin, altcoins and many other digital tokens. However, due to tightening regulations, back in Finland where the company is based, this option is no longer available. Mycelium charges absolutely no fees. You can use our Bitcoin ATM map to buy hony with cash. Changelly works in nearly every country but you will need another cryptocurrency in order to purchase bitcoins. The most convenient way to buy Bitcoin is an ATM.
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