Hong Kong Regulator Implements Stricter Custody Standards for Licensed Crypto Exchanges
<p>A regulatory review earlier this year found weaknesses in some exchanges’ cyber defenses, prompting the SFC to set new custody standards for licensed platforms.</p>
In a move to enhance security measures within the cryptocurrency sector, the Securities and Futures Commission (SFC) in Hong Kong has implemented tighter custody standards for licensed crypto exchanges. This decision comes after a recent regulatory review uncovered vulnerabilities in the cyber defenses of some exchanges operating in the region.
The SFC's new standards aim to bolster the protection of investor assets held by licensed platforms, addressing concerns around potential risks such as hacking and theft. By enforcing stricter custody protocols, the regulator intends to increase confidence in the crypto industry and safeguard against unauthorized access to digital assets.
Cryptocurrency exchanges in Hong Kong will now be required to adhere to these enhanced custody standards to maintain their licensing status. The SFC's proactive approach highlights the growing emphasis on regulatory compliance and cybersecurity within the rapidly evolving digital asset landscape.