Hong Kong SFC Flags Seven Unlicensed Crypto Exchanges

The Securities and Futures Commission of Hong Kong (SFC) recently issued warnings to seven cryptocurrency trading platforms operating without the necessary licenses. This action is part of the SFC’s ongoing efforts to protect investors from scams and fraudulent activities.

On July 5, the SFC added seven exchanges to its Alert List: Taurusemex, Yomaex, Bitones.org, BTEPRO, CEG, XTCQT, and Bstorest. These platforms were identified for either operating without a license or falsely claiming association with Hong Kong.

Since January 2020, the SFC has maintained an Alert List to inform the public about registered, unregistered, and illegal crypto trading entities. This initiative aims to minimize risks related to investment scams. As of 2024, the list includes 39 entries, with 28 flagged this year alone.

The SFC’s warnings indicate that these exchanges engaged in deceptive practices, leading investors to believe they were legitimate. Many of these platforms used extortion tactics, such as blocking withdrawals and demanding “fees” to restore access.

Regulatory Efforts and Future Prospects

Hong Kong has taken significant steps in 2024 to regulate cryptocurrency trading services. The SFC required all crypto exchanges to apply for a license by May 31, 2024. Those failing to comply were mandated to shut down operations.

During this period, over 22 exchanges applied for licenses, though several withdrew their applications before the deadline. This highlights the strict regulatory environment and the SFC’s commitment to ensuring compliance.

To further promote investor safety, Hong Kong government representatives attended a tech conference in Toronto, Canada. They aimed to attract Canadian crypto and Web3 startups, showcasing Hong Kong’s readiness as an offshore technology hub. This event was organized in partnership with the Hong Kong Economic and Trade Office in Toronto (Toronto ETO), Invest Hong Kong (InvestHK), and StartmeupHK (SMUHK).