HashKey promotes “Hong Kong Compliance” while launching Launchpool’s new token ZKJ internationally.
HashKey Exchange, the only compliant exchange in Hong Kong recognized by the Securities and Futures Commission (SFC), has become a rare market player after the withdrawal of licensing applications by exchanges such as OKX.
In Hong Kong’s regulatory framework, licensed operators face restrictions on stablecoin trading pairs, are prohibited from offering financial products, and are subject to limitations on the listing of currencies. They must adhere to strict consumer protection regulations, including asset segregation and insurance.
These restrictions prevent compliant operators from diversifying their offerings and profiting from a global user base, as offshore exchanges do.
HashKey Exchange operates both a Hong Kong-based platform and an international platform. While the Hong Kong platform holds a license, the international platform does not meet Hong Kong’s regulatory requirements. The international platform uses the term “licensed compliance” to describe its regulatory status, which can be seen as a form of borderline advertising, leveraging the Hong Kong license to gain customer trust. Such claims of “compliance” should be viewed neutrally.
In the fast-paced development of exchanges, there is hardly any exchange with a diverse business model (spot, futures, wealth management) that can be truly considered compliant. Licensed markets in countries like Japan, Singapore, and Hong Kong are subject to strict regulations and often only offer limited spot trading, restricting access to users outside their jurisdictions. Some offshore exchanges selectively apply for various financial licenses worldwide, such as the US MSB license, as a form of compliance proof, but these licenses do not undergo regulatory scrutiny or provide investor protection.
Therefore, international exchanges like Binance and FTX have attempted to establish compliant entities in specific regions and exclude overseas users. The purpose is to demonstrate a proactive approach to compliance, even at the cost of sacrificing business interests and incurring significant costs.
HashKey Exchange’s approach of expanding its international platform from a compliant Hong Kong base may also be adopted by many regional compliant exchanges. However, international users should understand the local nature of compliance and not expect the same concept to extend to the international version of the platform.
In the immature regulatory landscape of global exchanges, most operate with a self-regulatory attitude to protect international users in a diverse product environment.
HashKey Exchange, Launchpool, Polyhedra Network, and ZKJ are mentioned in the article.
