Hong Kong is one of the Asia’s finest fintech destinations. But the same can’t be said for the Bitcoin market anymore. According to a recent article in one of the leading Chinese dailies, Bitcoin businesses are slowly dying in the region.
Once considered a prolific market for cryptocurrencies, the sector has since then been stifled by strict regulations and red tape. Entrepreneurs in the digital currency industry who once flocked to Hong Kong to escape the heavy-handed Bitcoin regulations in the United States and Great Britain are finding themselves in a situation similar to the ones they tried to get away from.
In the absence of clear cryptocurrency regulations, various government bodies have come up with their own sets of conflicting rules and regulations. The situation has led to a drop in confidence among entrepreneurs and investors in the region. They have called for regulators to come together and draft unified regulations which can spare Bitcoin businesses from all the confusion.
The article quotes the president of the Bitcoin Association of Hong Kong, Leo Weese saying,
“I think regulators should be less risk averse, it is not their obligation to shield the Hong Kong economy from people losing money or other negative things.”
Even the country’s banking sector takes a fair share of the blame for not extending its services to Bitcoin and fintech businesses. The lack of access to bank accounts has rendered many startups handicapped, with no means to handle their finances. The co-founder of Bitspark remittance platform George Harrap says that the banks in Hong Kong don’t consider the compliance requirements, existing licenses or operation history before refusing service to Bitcoin and fintech companies.
In the middle of all these confusion, the Bitcoin sector is finding Singapore to be a much better place for operations. However, the bureaucrats have a different story to tell. They believe that Bitcoin has been overshadowed by the advances in blockchain technology and its applications. They blame the negative publicity received by Bitcoin for failing interest in the cryptocurrency among the general public.
Either way, the current situation is going to impact Hong Kong’s standing as one Asia’s leading financial hubs.
Ref: South China Morning Post | Image: NewsBTC