Interactive Brokers, one of the largest stock trading platforms, is launching a bitcoin and ethereum trading platform in Hong Kong.
“Investor demand for digital assets continues to grow in Hong Kong and around the world, and we are pleased to introduce cryptocurrencies to meet clients’ business goals in this important market,” said David Friedland, APAC Director. at Interactive Brokers.
The service will be limited to people with HKD 8 million (Reais 5 million) in investable assets, but this move comes amid weeks-long speculation that Hong Kong is opening up to the cryptocurrency market.
“We are confident that Hong Kong will soon develop a thriving ecosystem of virtual assets,” Hong Kong Finance Secretary Paul Chan told a Web3 conference last month.
The semi-autonomous region passed a new cryptocurrency law that some industry insiders say aims to open retail trading from June 1.
“The United States is in danger of losing its status as a financial center in the long term, with no clear rules on cryptocurrencies and a hostile environment from regulators.”Coinbase co-founder Brian Armstrong said, referring to these speculations, adding:
“Congress must act soon to pass clear legislation. Cryptocurrency is open to everyone in the world and others are leading the way. The EU, the UK and now Hong Kong”.
Will China open up cryptocurrency trading?
The main driver of these rumors is Justin Sunwho became known in the market as the founder of the Chinese cryptocurrency Tron, but now has a much bigger role as the owner of the Huobi exchange, one of the largest cryptocurrency exchanges in China and the world.
Hong Kong is seen as “one of the experimental zones for the development of cryptocurrencies in China”, the Sun told Bloomberg TV in an interview on Friday. This is “one of our biggest reasons to expand in Hong Kong”.
On social media, he has been less restrained, stating: “China is moving towards a more crypto-friendly policy and it’s amazing to see Hong Kong and Beijing getting on board”.
Coindesk disagrees. “No, Hong Kong will not allow retail merchants access to cryptocurrencies on June 1st.”they affirm.
As always with China, there is Schrödinger and since 2018, but there is genuine room for speculation both with regard to cryptocurrencies and more generally that China may have no choice but to change its tune.
“China’s reign as a production center for foreign companies seems to be coming to an end. Foreign direct investment (FDI) in new facilities and mergers and acquisitions (M&A) in China is plummeting, and investors are increasingly worried about China’s future as other Asian countries become more attractive,” he says. a new report.
FDI from China is currently half that of 2019 and in some sectors, such as tourism, food or financial services, it has fallen by around 70%.
The communist turn, which saw Jack Ma jailed for a single speech, now has rhetoric back to opening up.
In fact, Chinese Foreign Minister Wang Yi is on a tour of Europe, recently met with Macron, and will soon leave for Germany and Italy. In addition to two other curious destinations, Hungary and Russia.
Presumably he will have the same message: out with communism and back with openness and reforms and he clearly thinks he has a softer ear in Europe.
His visit to Russia, however, comes just before an offensive, or outbreak as we call it, so I would be very curious what Germany will say in private, especially considering that its foreign minister is Annalena Baerbock.
Other than that, when it comes to economic relations, China’s unpredictability means, in our view, that business is fine as long as there is no trust.
They are clearly in a very difficult financial situation, having been through some of the most difficult times in 30 years.
Furthermore, last month’s brief protest may have reminded Beijing that ultimately, regardless of the system, there are no rulers apart from the public.
Return of cryptocurrencies to China
So the recent talk about de-escalation can be entertained, although it would have been much better and much more credible if it had not come with a third term.
And while Coindesk disagrees on the issue of cryptocurrencies, in our opinion, it is perhaps even likely that Hong Kong will open up, since it makes no sense at this time to remain isolated.
As cryptocurrencies are at the borders, companies take more notice of their treatment. Making it a good place to start.
Put another way, they basically have to open exchanges if Hong Kong wants to be taken seriously by global trade.
And eventually, China does too if it wants to maintain its economic position, but as the planned visit to Russia shows, it’s not quite clear if they’re really out of the “axis mentality”.
A Hong Kong opening, therefore, would be the middle way, a Schrödinger in progress, but perhaps not quite for cryptocurrency entrepreneurs who have their clever ways of dealing with these cats.
Therefore, all that can be said is that we are back in the easing phase in China after the 2021 cryptocurrency tightening, which banned industrial mining.
In a way, this is a continuation, as after exchanges were banned in 2017, Chinese President Xi Jinping went on to talk about blockchain in 2018.
The real test, therefore, is whether a squeeze will occur. Until then, the opening remains speculation.
Except that opening Hong Kong’s cryptocurrency trade to retail is a significant move that allows the question to remain: is China really turning the page?
They definitely do. Especially since nationalism is now firmly in decline and is being defeated on the battlefield.
The real story here, however, could very well be the rise of Justin Sun, who quietly became a pretty big actor and could become one of the biggest if Hong Kong and China open up.
Huobi and China have always had a warm relationship, even in difficult times for cryptocurrencies. The exchange, in which Sun owns 60%, is of course much larger than man, and its natural habitat is Asia.
We will know about this change as it will be clearly visible on the chart. Shanghai’s business hours disappeared last year, so what happens there is one way of looking at the cat.
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