Hong Kong Grants Licenses to Crypto Exchanges
On January 27, 2025, Hong Kong’s Securities and Futures Commission (SFC) issued licenses to two local exchanges, PantherTrade and YAX, marking the first crypto trading licenses granted this year. The SFC has approved four cryptocurrencies for trading on these platforms: Bitcoin, Ether, Avalanche, and Chainlink.
XRP’s Absence Raises Regulatory Questions
Notably, Ripple’s XRP is absent from the SFC’s approved list, despite its global adoption and initiatives to expand its use through potential ETFs and futures. The SFC has not provided an official explanation for this exclusion, leading to speculation that it may be related to Ripple’s ongoing legal challenges in various countries.
Strict Compliance Requirements for Exchanges
Licensed exchanges in Hong Kong must adhere to stringent regulations, including anti-money laundering (AML) and counter-terrorist financing (CTF) laws. As of now, ten crypto exchanges have registered under these regulations and are authorized to operate virtual asset trading platforms in the city. The SFC had initially planned to approve eleven crypto trading platforms by the end of 2024 but faced delays due to rigorous compliance checks. In December 2024, four virtual asset trading platforms were granted licenses, and regulators continue to work closely with exchange executives to ensure they meet financial standards.
Ripple’s Engagement with Hong Kong’s Financial Initiatives
Despite XRP’s exclusion from the approved trading list, Ripple has been actively involved in Hong Kong’s financial initiatives. In May 2023, Ripple, in collaboration with Fubon Bank, participated in the Hong Kong Monetary Authority’s inaugural e-HKD Pilot Programme, showcasing a real estate asset tokenization solution.
The omission of XRP from Hong Kong’s approved cryptocurrencies underscores the complex regulatory landscape that digital assets navigate, even as they gain traction globally.