Hong Kong Regulator Warns of Cryptocurrency Risks

February 09

The Hong Kong Securities and Futures Commission (SFC) issued a statement today repeating an earlier alert to investors to the potential risks of dealing with cryptocurrency exchanges and investing in initial coin offerings.

The SFC’s statement echoed similar concerns recently voiced by the U.S. SEC.  That is, the SFC sent letters to seven cryptocurrency exchanges in Hong Kong or with connections to Hong Kong  warning them that they should not trade cryptocurrencies which are “securities” as defined in the Securities and Futures Ordinance (SFO) without a license.  The SFC also called out professionals, noting that  “ICO issuers are typically assisted by market professionals such as lawyers, accountants and consultants for advice to structure the offering as utility tokens to fall outside the purview of the SFO and to circumvent the scrutiny of the SFC.”

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David Zaslowsky has a degree in computer science and, before going to Yale Law School, was a computer programmer. He is currently the Chairman of the Litigation Department of the firm’s New York office. His practice focuses on international litigation and arbitration. He has been involved in cases in trial and appellate courts across the United States and before arbitral institutions around the world. Many of David’s cases, including some patent cases, have related to technology. Since 2008, David has been included in Chambers for his expertise in international arbitration.

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