Dubai-based cryptocurrency exchange, Bybit, has recently announced its intentions to expand its central Asian business into Hong Kong. Bybit plans to allocate a segment of its marketing, research, and development team to the city, as it seeks to establish its primary Asian operations there. The exchange has also expressed an interest in seeking a license in the city under the proposed legislation, set to be effective from June.
According to Bybit’s CEO, Ben Zhou, liquidity is the key to the exchange sector, and Hong Kong has an abundance of it due to capital inflows from institutional investors. Zhou also praised the city’s developed capital markets, high levels of financial literacy, and the presence of genuine and knowledgeable investors.
However, the proposed rules for centralized exchanges and retail trading in Hong Kong have caused some businesses to express concerns over the costs of obtaining and maintaining licenses, as well as the profitability of establishing operations in the city. The proposed guidelines limit trade to highly liquid and established cryptocurrencies like bitcoin and ether, potentially restricting the market for exchanges.
The securities regulator has yet to finalize the guidelines, leaving the question of whether exchanges will be allowed to cater only to residents, who constitute a relatively small market, up in the air. Nonetheless, Bybit remains optimistic about the potential opportunities in Hong Kong’s crypto market and intends to press forward with its plans for expansion.