DFX Labs wrote a success story by obtaining the Anti-Money Laundering and Counter-Terrorist Financing Regulation (AML) license with the approval of the Hong Kong Securities and Futures Commission (SFC). This development shows that DFX Labs is one step closer to a full operating license.

But the situation does not always look so positive. DFX Labs’ AML license does not currently allow the platform to offer cryptocurrency trading services. SFC’s official records also confirm this situation. Although the records state that DFX Labs is “deemed licensed to provide virtual asset services,” it is noted that the platform does not yet have the full license required for crypto trading.

This makes the crypto licensing process in Hong Kong a bit complicated. Although some platforms, such as DFX Labs, have successfully passed the AML phase, the main goal, the full licensing process, is still ongoing. DFX Labs applied for the license on December 27, 2023. The company’s operations director, Simon Au Yeung, was the main person who submitted the application. Although the fact that the platform received the AML license on June 1 shows that the process is progressing quickly, it remains unclear how long it will be necessary to wait for the full license.

The status of the DFX Labs website also reflects this uncertainty. It is stated that the site is still an unlicensed virtual asset platform and is not accessible to Hong Kong residents. This shows that Hong Kong’s cryptocurrency regulations are not yet fully established and platforms are struggling with these uncertainties.

Another important development in the Hong Kong crypto market is the government’s support for entrepreneurs. Organizations such as Hong Kong Economic and Trade Office Toronto (Toronto ETO), Invest Hong Kong (InvestHK) and StartmeupHK (SMUHK) recently held a conference in Toronto to promote investment opportunities for Canadian cryptocurrency and Web3 startups. This conference can be considered as an indication that Hong Kong wants to strengthen the cryptocurrency ecosystem and recruit leading entrepreneurs.

Toronto ETO Director Emily Mo emphasized Hong Kong’s entrepreneur-friendly regulations in her speech. Mo highlighted lower taxes, especially compared to Canada, and the government’s willingness to work with “specialist technology companies that are not commercially operational.” These statements reveal that Hong Kong aims to attract innovative entrepreneurs in the field of cryptocurrency.

However, while there are positive developments in Hong Kong’s crypto market, we also see that hesitations continue. In May, all cryptocurrency exchanges operating without a license in Hong Kong had to be closed. This situation revealed Hong Kong’s strict regulatory policy. In addition, even major global players such as OKX, Huobi HK and Bybit withdrew their license applications in Hong Kong, creating an atmosphere of distrust in the market.