Hong Kong Securities Regulator Warns Against Unlicensed Virtual Asset Trading Platforms

The Hong Kong Securities and Futures Commission (SFC) has issued a warning to cryptocurrency investors, urging them to only use or trade on approved virtual asset trading platforms (VATPs). The regulator emphasized the importance of verifying a VATP's regulatory status before engaging in any transactions.


This warning comes after the SFC previously advised users to avoid unlicensed operators, stating that many of these entities had little chance of obtaining a license. In its latest statement, the SFC also highlighted the existence of two lists: one for licensed entities and another for platforms that have applied for a license.

The SFC clarified that VATPs featured on the "List of licensed virtual asset trading platforms" have been formally licensed by the regulator. On the other hand, VATPs on the "List of virtual asset trading platform applicants" are operating in Hong Kong and have submitted license applications to the SFC before February 29, 2024.

Consequences for Unlicensed VATPs

The SFC has set a deadline for Virtual Asset Service Providers (VATPs) to submit their license applications. Entities failing to do so by February 29 will be required to cease operations by May 31. The regulator also advised crypto users who are using VATPs not featured on either list to close their accounts or consider transferring their funds to licensed VATPs.

The SFC emphasized that trading on platforms featured on the applicants list still carries a risk, as their applications are still being processed. The regulator concluded its statement by urging users to avoid trading on unapproved VATPs, as they offer no protection to investors.

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Frequently Asked Questions

Can I store my Gold IRA at Home?

Online brokerage accounts are the best way for you to invest your money. You have all the investment options you'd get if you had a traditional broker. However, you don't require any licenses or qualifications. Plus, there are no fees for investing.

Many online brokers also offer tools that can help you manage your portfolio. Online brokers will allow you to download charts so that you can see the performance of your investments.

Can a gold IRA earn any interest?

It all depends on how big your investment is. If you have $100,000, then yes. You will not be able to answer if your income is less than $100,000

The amount of money you put into an IRA determines whether or not it earns interest.

You should consider opening a regular brokerage account instead if you put in more than $100,000 per year for retirement savings.

There you will earn more interest, but also be exposed to higher risk investments. If the stock market crashes, you don't want all your money to be lost.

An IRA might be more advantageous if you are able to contribute only $100,000 per year. At least until the market recovers.

How does an IRA with gold or silver work?

A gold and silver IRA allows you to invest in precious metals, such as gold and silver, without paying taxes on any gains. This makes them an attractive investment for people who want to diversify their portfolios.

If you are over 59 1/2, income tax is not due on the interest earned from these accounts. Any appreciation in the account's worth does not attract capital gains tax. There are limits on the amount of money that you can place into this account. The minimum amount is $10,000. Under 59 1/2 years old, you can't make any investments. Maximum annual contribution: $5,500

Your beneficiaries could receive less if you die before your retirement. After you have paid all your expenses, your estate should include sufficient assets to cover the balance of your account.

Some banks offer a silver and gold IRA option. Others require you open a regular broker account, through which shares or certificates can be purchased.


  • You can only purchase gold bars of at least 99.5% purity. (forbes.com)
  • If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal so that you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (forbes.com)
  • Same tax rules as traditional IRA SEP IRA contributions in 2022 are limited to 25% of compensation or $66,000, whichever is less Before setting up a Silver IRA, understand the fees and IRS restrictions. (sltrib.com)
  • The IRS also allows American Eagle coins, even though they do not meet gold's 99.5% purity standard. (forbes.com)

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How To

How To Buy Gold For Your Gold IRA

Precious metal is used to describe precious metals such as gold, silver (excluding helium), palladium, palladium or osmium), ruthenium, rose, rhenium, ruthenium and others. It refers only to elements with atomic number 79-110 (excluding helium). These elements are considered valuable because they are rare and beautiful. Silver and gold are the most well-known precious metals. Precious Metals are often used for money, jewelry and industrial goods.

Supply and demand affect the gold price daily. As investors seek safety from unstable economies, there has been an increase in demand for precious metals in the last decade. Prices have increased significantly because of this demand. However, some are hesitant to invest in precious metals because of the rising costs of production.

Gold is a good investment because it's rare and durable. Unlike many investments, gold never loses value. You can also buy and sell gold, without having to pay taxes. You have two options to invest in gold. You can either purchase gold bars and coins or invest in futures gold contracts.

In-dispute liquidity can be achieved with physical gold bars or coins. They are easy for you to store and trade. But they don't offer much protection against inflation. Consider purchasing gold bullion if you want to be protected from rising prices. Bullion, also known as physical gold and available in different sizes, is physical. Many billions come as one-ounce pieces while others are larger like kilobars. Bullion is stored in vaults that are protected against theft and fire.

Gold futures can be a great way to buy shares rather than actual gold. Futures let you speculate about how gold's price might change. Gold futures allow you to be exposed to its price without owning any physical commodity.

For instance, if I wanted speculation on whether gold prices would go up or lower, I could buy a contract for gold. My position when the contract expires is either “long”, or “short”. A long contract means that I believe the price of gold will go higher, so I'm willing to give someone else money now in exchange for a promise that I'll get more money later when the contract ends. A short contract on the other side means that I believe gold's price will fall. I'm willing now to accept the money in exchange for the promise of making less later.

I'll get the contract's specified amount of gold plus interest when it expires. I am now exposed to the price of gold, without actually holding it.

Because they are extremely difficult to counterfeit, precious metals make great investments. Precious metals can't be counterfeited like paper currency. However, new bills can be printed to make them look more authentic. It is because precious metals are hardier than paper currencies that they can be counterfeited by printing new bills.


By: Terence Zimwara
Title: Hong Kong Securities Regulator Warns Against Unlicensed Virtual Asset Trading Platforms
Sourced From: news.bitcoin.com/hong-kong-securities-regulator-issues-warning-to-unlicensed-virtual-asset-trading-platforms/
Published Date: Tue, 06 Feb 2024 11:30:34 +0000

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