Hong Kong-based cryptocurrency exchange Gate.HK is shutting down due to its failure to meet the local licensing requirements set to be enforced from June 1 onwards.
The Securities and Futures Commission of Hong Kong (HKSFC) mandated that all crypto exchanges in the region must obtain an operational license. Exchanges that didn't apply for a license were required to cease operations by May 31.
Gate.HK submitted its license application to the HKSFC on February 28 but withdrew it on May 22, citing the need for a significant overhaul of its trading platform.
Effective May 23, Gate.HK ceased acquiring new users and marketing activities. Existing users can only withdraw funds until August 28.
The exchange will permanently delist all tokens on May 28, including Bitcoin (BTC), Ether (ETH), Solana (SOL), Polygon (MATIC), and Tether (USDT), among others.
Gate.HK plans to relaunch its services after restructuring its platform to comply with Hong Kong's regulatory requirements, which include implementing Anti-Money Laundering (AML) and counter-terrorism financing measures.
Before Gate.HK's closure, three other exchanges—Huobi HK, QuanXLab, and IBTCEX—also withdrew their license applications in May. In total, nine crypto exchanges have withdrawn their applications in Hong Kong.
Recent reports suggest that the HKSFC is considering allowing spot Ethereum exchange-traded fund (ETF) issuers to offer an ETH staking option, enabling them to generate passive income.
The regulator is in discussions with crypto ETF issuers regarding providing staking services via licensed platforms but has not yet set a timeline for implementation.
May 2024, Cryptoniteuae