EU & Hong Kong Signal Welcoming Stance For Crypto

GB Market Commentary 19/04/2023

by Marcus Sotiriou

Crypto regulations outside of the US continue to progress in favour of adoption. For example, Hong Kong has declared crypto as property within a court case, whilst the EU lawmakers show support for the MiCA bill.

Law firm Hogan Lovells reported today that the Hong Kong court has recognised crypto as property, that is "capable of being held on trust". This case involved digital asset broker platform Gatecoin. This ruling is juxtaposed to the aggressive approach of the US, and it would provide Hong Kong liquidators with clarity on how to treat digital assets caught up in winding down procedures. ‘Property’ has a wide meaning in Hong Kong, however this is still significantly more welcoming than the US.

In addition, the Hong Kong arm of the major Chinese state-owned Bank of Communications is working with digital asset brokers and businesses whom are registered there, resulting in nearly 80 cryptocurrency businesses showing interest in expanding their business in the region.

Furthermore, in the EU lawmakers from various parties, including the European People’s Party, Socialists and Democrats, Renew Europe, and European Conservatives and Reformists, have shown support for the Markets in Crypto Assets regulation (MiCA) in a debate today. This suggests that the bill will likely pass a vote due Thursday.

The MiCA bill allows digital asset brokers, exchanges and custodians to offer regulated services.

“Europe can be proud of the step we're taking today,” Lídia Pereira, of the center-right EPP which constitutes the biggest political grouping in the European Parliament, told fellow lawmakers.

Stefan Berger, the German center-right lawmaker who led the parliament’s negotiations on the law, said MiCA should “restore the trust that was damaged by the FTX case” and put the EU “at the forefront of the token economy.”

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