Hong Kong, UAE to collaborate on crypto rules

• The central banks of Hong Kong and UAE have agreed to cooperate on cryptocurrency regulations.
• The regulators are exploring how to leverage each other’s markets for the growth of the crypto sector.

Officials from the central banks of both Hong Kong and the United Arab Emirates held a bilateral meeting on 30 May in Abu Dhabi to discuss cryptocurrency regulations and financial technology development.

The Hong Kong Monetary Authority (HKMA) and the Central Bank of the United Arab Emirates (CBUAE) agreed to strengthen cooperation on “virtual asset regulations and developments.”

The two central banks also agreed to promote discussions about joint fintech development initiatives and “knowledge-sharing efforts” with each region’s respective innovation centers.

The key issues discussed include financial infrastructure and financial market linkages between the two jurisdictions.

H.E. Khaled Mohamed Balama, governor of CBUAE, said that he expects the relationship with HKMA to be ongoing and long-term.

HKMA chief executive Eddie Yue said that the alliance will assist both the regions economically as they share many “complementary strengths and mutual interests.”

Thereafter, the two central banks hosted a seminar for senior executives from banks in Hong Kong and the UAE. It covered various topics including how cross-border trade settlements can be improved.

Hong Kong and UAE: Emerging crypto centers in Asia

According to a Bloomberg report published in April, the Hong Kong Securities Futures Commission (SFC) is scheduled to announce cryptocurrency exchange licensing guidelines next month.

The new rules will allow retail investors to trade major tokens like Bitcoin and Ether. This would be under a new licensing regime for crypto platforms, beginning 1 June.

The SFC also announced new plans recently to provide retail investors with access to virtual asset platforms as it expands access to cryptocurrency trading.

In early February, the government of Dubai’s Virtual Assets Regulatory Authority published its 2023 rulebook for regulating cryptocurrency. The new rules were to attract crypto businesses, protect digital asset dealers and investors, and curtail illegal practices.

Hong Kong and UAE are exploring how to leverage the markets of each other for the growth of crypto sector. The two regions are among the important crypto centers in Asia.