As per Hongkong Stock Exchange, nothing else could regulate the fintech firms and blockchain entities as the current financial law is regulating them already.
The informative outcomes
The authority made the above statement based on a recent research report, which was published on Oct 18. In the report, the HKEX’s Chief China Economist’ Office & innovation Lab take a deep dig on the efficiency of blockchain & Artificial Intelligence within the financial area’s periphery. The outcome of the research report also suggested that the blockchain technology looks very promising when integrated into financial areas like trading, investment, and settlement. However, there is a deep need to regulate them to achieve the desired result. The existing financial regulation can easily do it. It also emphasizes the need to have a similar financial regulation on every entity irrespective of the nature of the operation.
As per the author of the research report, though one can’t ignore the need of different jurisdiction on different technologies, there is an unwavering need to have “constant principle” in all financial activities. In plain words, all the financial businesses should be legally-bound under the same regulation. The author further explains, “The principle of consistency requires that… the issuance of digital currencies and digital funds must be governed under the existing securities regulatory framework.”
The right step at the right time
The report came into the public’s eyes too. After that, the Financial Action Task Force announced that the agency would decide legal implication to regulate the international cryptocurrency by coming June. If implemented, this move will compel any country to have a license and regulate exchanges for initial coin offerings (ICOs) who seeks to mark its presence in the international financial system.
HKEX also initiated a discussion with ASX (Australian Securities Exchange) over blockchain settlement system earlier in March.