HKMA issued a statement announcing that it expects authorized institutions to take note of the BCBS statement on crypto-assets and its prudential expectations. Authorized institutions planning to engage in activities relating to crypto-assets should discuss with HKMA and demonstrate that they have put in place appropriate systems and controls to identify and manage any risks associated with such activities.
On March 13, 2019, BCBS had issued a statement sets out the prudential expectations of BCBS regarding banks’ exposures to crypto-assets and related services in jurisdictions where banks are involved in such business activities. As the BCBS explains, crypto-assets do not reliably provide the standard functions of money and are unsafe to rely on as a medium of exchange or store of value. Such assets are not regarded as legal tender and are not backed by any government or public authority. BCBS believes that the continued growth of crypto-asset trading platforms and new financial products related to crypto-assets has the potential to raise financial stability concerns and increase risks faced by banks.
Keywords: Asia Pacific, Hong Kong, Banking, Crypto-assets, Regtech, HKMA
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