SFC Circular on Bitcoin Futures and Cryptocurrency Investment Products

SFC Circular on Regulation of Bitcoin Futures and Cryptocurrency Investment Products and Related Risks

The Securities and Futures Commission (SFC) issued a Circular on 11 December 2017 stating that it regards Bitcoin futures contracts traded on U.S. futures and commodities exchanges (Bitcoin Futures) as “futures contracts” for the purposes of the Securities and Futures Ordinance (the SFO). Companies carrying on a business of dealing in Bitcoin Futures, which would include those who relay or route Bitcoin Futures orders for Hong Kong investors, must therefore be licensed for Type 2 regulated activity (dealing in futures contracts), unless an exemption applies. Strict compliance with the suitability and conduct requirements of the Code of Conduct for Persons Licensed by or Registered with the SFC (the Code of Conduct) is also required. Read more…