News

From the Digital Business Practice Group

From the Digital Business Practice Group

From the Digital Business Practice Group

Monday, 12 February 2018 19:29

There have recently been a number of important announcements from Regulators, both in Hong Kong and in the United States, about ICOs and cryptocurrency exchanges.

First there was an announcement by the Chairman of the United States SEC stating that he considered that the majority of “ICOs” related to “securities”, which therefore fell under the SEC preview.

That was followed on 9th February, by the Hong Kong SFC alerting investors to the potential risks of dealing with cryptocurrency exchanges and in investing in ICOs.

The SFC has now sent letters to several cryptocurrency exchanges in Hong Kong warning them that they face sanction if they continue to trade cryptocurrencies without a licence.

There have also been complaints in Hong Kong asserting that certain cryptocurrency exchanges have misappropriated assets, manipulated markets, and have been involved in unlicensed and fraudulent activities, all of which have caused significant losses to investors/buyers.

OLN’s Digital Business Practice Group advises not only on the commercial and regulatory side of ICOs and cryptocurrencies, but also on the ability for investors and buyers of coins and tokens to claim against issuers and cryptocurrency exchanges, if they consider there has been fraud, misrepresentation, misappropriation of assets and or market manipulation.

If you need further advice on any of these issues, please contact either our Stephen Chan. We would then be happy to advise on what causes of action may be available in Hong Kong.