As per ananalysisreportrevealed, the HKEX’s Chief China Economist’soffice and Innovationresearch laboratorylooked primarily at the potential of Blockchain and Artificial IntelligenceIamongareas of finance, providingan outlineof blockchain anddoableuse cases incommercialism, settlement and equities markets,for instance.
Emerging technologieslikeblockchain, it says,might be“integratedwithin theareas of investment, trading, clearing and settlement,” adding thatlaws, too,ought tobe commonto any or allfirmswithin thefinanceecosystem.
Whiletotally different jurisdictionsmightapply different rules to the technology in some use cases, the authorscounselsapplying what theycallthe “consistency principle” infinancialregulation –that’s the similar “financial businessesidenticalto theexistingregulations.”
While adding further, the authors aforementioned:
“The principle of consistencyneedsthat … theissuanceof digital currencies and digital fundsshouldberuled underneaththe presentsecuritiesregulativeframework.”
“The public fund-raising activities of sharesissuanceby issuers —thatdosowithsimplya prospectusrevealed onthe webbutwith noneunderwriter nor compliance with theIPOregistration procedures or strictdisclosure actrequirements—mustbecorrectedby subjecting them to the governance by theSecurity laws.”
Further,linkingsimilar financial servicesunderneathexisting rules would “maintaintruthfulcompetition,guaranteeregulativeeffectivenessand stopregulativearbitrage,” the report argued.
One potential issue raised is that the fast-changing nature of fintechwilldoubtlessopen upregulative “loopholes.” As a result, it said,lawsought tobe “continuously updated”to staypace with technologicalamendment.
The report came onidenticalday that thatworld-widemoney-laundering watchdog, theFinancialAction Task Force,aforementionedit’lldraw up rules for international cryptocurrency regulation by next year inJune.
The move would see any countrythat desiresto remainenclosedwithin theinternational finance system having to license and regulate exchanges,digital wallet providersandcompanieshook up withinitial coin offerings.
Even earlier in March this year, HKEX was reportedly in talks with itsantipodalcounterpart, the Australian Securities Exchange [ASX],to find outfrom its experiences in shifting over to a blockchain settlement system.