The world’s leading market for cryptomone futures could face strong regulatory pressure

Hong Kong appears to be strengthening regulations on cryptomoney exchanges.

Proposed regulations targeting Hong Kong’s blockchain industry could have far-reaching consequences for the crypto-derivatives market, according to new research by

In a report released Wednesday, researcher Mira Christanto said the Hong Kong Special Administrative Region, which happens to be the dominant market for crypto currency futures trading, could be cracking down on unregulated exchanges as part of a broader push for greater governance.

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The researcher cited a recent proposal by the Hong Kong Securities and Futures Commission, or SFC, that would require all cryptosecurity companies to be subject to anti-money laundering rules. This is a significant change Bitcoin Compass from only one year ago, when SFC announced that it would only regulate companies in the „securities“ space.

Previously, SFC only regulated assets that met the legal definition of securities or futures, a definition that excluded crypto-currencies.

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As Cointelegraph reported earlier this month, the Hong Kong government has proposed to bring all cryptoactives under the supervision of its securities regulator. The regulatory intention appears to be part of a global initiative to curb cryptoexchanges, possibly under the guise of money laundering concerns.

As Messari points out, Hong Kong is the most dominant player in the cryptomoney futures market. Almost three quarters (72%) of Ethereum futures (ETH) and 57% of Bitcoin futures (BTC) come from the Special Administrative Region.

Christanto said:

„Many people do not realise the role Hong Kong plays in global crypto space. Hong Kong is home to some of the largest companies and dominates the growing futures market“.
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Hong Kong is home to a large presence of cryptoexchanges and market services companies, including BitMEX, Bitfinex, and FTX. Exchanges such as OKEx, Huobi and Bybit maintain regional offices in the semi-autonomous city-state. Major industry players such as Tether, Cardano and EOS publisher are also located in Hong Kong.

If the new proposal becomes law, companies that continue to operate without a license could face severe penalties. There is even the possibility of prison sentences for the executives of companies operating these platforms.

As Messari notes, to date, only two crypto-currency financial services companies have been licensed in Hong Kong.

Bitcoin hits record appreciation and Ibovespa has the highest weekly turnover, dropping around 7.40%

While Ibovespa goes back more than 7% with uncertainties about the future of the economy in Brazil, Bitcoin beat record valuation reaching R$ 80 thousand in the country

In the last week of October Bitcoin price has skyrocketed all over the world and, specially in Brazil, due to the devaluation of the Real against the dollar the main cryptomoeda of the market has registered records of valuation reaching US$ 80 thousand.

However, in the same period, Ibovespa, has registered its worst performance falling more then 7%.

Investor who applied $ 1 thousand in savings has today $ 1,013 if had bought Bitcoin would have $ 2,732

According to iHub Investimentos founder partner, Paulo Cunha, since the beginning of the month the stock market came with a three weeks high sequence, reaching again the 100 thousand points mark.

However, in this last week of October, the scenario changed reaching the score of 93,771.60.
Bitcoin X Ibovespa

The last week of October saw Bitcoin start trading in the range of $ 73,000 on October 26, when BTC went from $ 73,686.

But on Saturday, 31, the cryptomoeda broke another record being traded above $ 80,000 for a short period and closing the day at $ 79,405.

The Ibovespa also fell strongly impacted by the commercial dollar which rose about 2%, with sale at $ 5.74, considered the highest value since May and playing even more uncertainties with the recovery of the economy in the country.

„The external scenario has contributed to the risk aversion increase and a possible new stop of the economy. This resulted, so far, in the worst week since March, besides one of the worst weeks of the second half of 2020“, explains Paulo Cunha.


However, according to Cunha, in the case of Ibovespa, despite the concerns, the drop seems exaggerated and enters in contrast with the good balance sheets of companies that have been releasing results in Q3 (third half of 2020), above market expectations.

„Some investors have taken advantage of the moment to buy some papers at lower prices and the recommendation has been not to sell or alter in a significant way the portfolio,“ says Cunha.

The Vix Americano index, which measures the market volatility, has touched 40,00 points and this only happens when the market goes through stress moments. Therefore, it is a very uncertain moment and demands caution.

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On the other hand, the local stock market and the international funds linked to the shares continue to be indicated for investors with a moderate and aggressive profile.

„Some houses of analysis continue to project the stock market above 100 thousand points by the end of 2020. When dealing with the options market, for example, the capture is made in a stronger way the volatility of stocks. Some options have reached more than 500% in a few days amid the strong Ibovespa drop“, explains Paulo Cunha.


In the case of Bitcoin, the expectation is of new highs that can take BTC to its highest historical value against the US dollar.

The charts indicate that the monthly Bitcoin price candle closed in October above US$ 13 thousand.

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This is the first time since December 2017 when BTC reached its historic high of US$20,000

For traders, a break above this mark indicates that there will be no resistance for BTC to reach US$ 20 thousand again.

Cathie Wood from Ark Invest is one of those who believe that the US$ 13 thousand break will be fundamental for a race „on the fly“ up to US$ 20 thousand.

„That $13,000 level is important because if we went through that, in technical terms, there would be very little resistance and we’d probably be back to the peaks we saw at the end of 2017 – so about $20,000 . Now, we’re not sure if that’s going to happen. We could be in a new trading range, just a little above the recent six to 10. Maybe we’re in the $10,000 to $13,000 range. However, a leak,“ he said.