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Singapore and Hong Kong Becoming Asian ICO Hubs – But There’s a Twist

Singapore and Hong Kong Becoming Asian ICO Hubs – But There’s a Twist 101
Traditional Chinese junkboat sailing across Victoria harbour, Hong Kong. Source: iStock/Onfokus

Asia-wide initial coin offering (ICO) policing has led to an enormous spike in token issuance in Singapore and Hong Kong. This has led PwC, one of the Big Four auditors, to set up a new ICO-specialist team in Hong Kong – as Chinese, South Korean, Japanese and other Asian companies look to issue token sales without the burden of regulations. But new developments suggest that the clock is ticking – and that both Singapore and Hong Kong may soon end up policing ICO issuance.

Speaking to the South China Morning Post, a fintech expert at law firm RPC in Hong Kong said that ICO-related inquiries have increased since September last year, and are now “coming in at a daily pace.” The lawyer stated, “The obvious next step for many Chinese ICO issuers is to cross the border. You can still speak Chinese [in Hong Kong], but you can operate in a more favorable regulatory environment.”

Singapore’s thriving financial sector has also made it a logical territory from which to conduct ICO activity. Companies and individuals based elsewhere in Asia, including South Korea and the Philippines have already taken advantage of this fact – and the country’s comparatively unrestrictive approach to policing ICOs

However, the same media outlet also quotes a spokesperson from the Singaporean central bank as saying the body recognizes “significant risks in the use of cryptocurrencies,” and stating that “work on [ICO regulations] is underway.” And there are also suggestions that Hong Kong is also willing to step up its policing of ICOs. Earlier this year, the autonomous territory’s regulatory Securities and Future Commission investigated multiple complaints “against ICO issuers’ alleged unlicensed or fraudulent activities,” and ordered a number of companies to withdraw their ICO applications.

China was once the continent’s de facto ICO pivot, but a wide-scale crackdown in September 2017 saw crypto startups move abroad in droves. South Korea, meanwhile, is said to be mulling changes to its own ICO law, although ICOs are currently banned in the country. However, should Seoul reverse its ban, it will likely impose potentially strict regulations on token sales. Japan is also working on game-changing ICO regulation initiatives. A crackdown may also be forthcoming in Vietnam, where two major ICO scams have shaken public confidence in cryptocurrencies.

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