Investors in Hong Kong Alerted by SFC about ByBit, a Cryptocurrency Broker
The Securities and Futures Commission (SFC) of Hong Kong has issued a cautionary note to investors regarding Bybit and several of its offerings, citing the cryptocurrency exchange’s absence of regulatory approval. The SFC has identified concerns with 11 products provided by Bybit, deeming them risky investments for the public.
The regulatory body specifically pointed out various offerings from Bybit, such as futures contracts, options, leveraged tokens, and other cryptocurrency-related services. These offerings have been promoted to Hong Kong’s investors without the necessary regulatory approval, which could subject them to considerable financial jeopardy.
In Hong Kong, transactions involving crypto-related products are classified as regulated activities that mandate authorization from the SFC. The regulator underscored its dedication to pursuing actions against entities operating without a license, highlighting the critical need for investor vigilance.
The SFC has cautioned: “Engaging with an unlicensed entity may result in investors losing their entire investment if the entity halts operations, goes bankrupt, or engages in asset misappropriation. It is often challenging to seek redress against entities without a presence in Hong Kong, and legal options may be limited.”
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The SFC has also commenced an inquiry into BitForex, another cryptocurrency exchange, on the grounds of suspected fraud. BitForex’s abrupt disappearance on February 23 and reports of $57 million vanishing from its hot wallets have stirred alarm within the crypto community.
Following its disappearance, the SFC included BitForex in its warning list for operating without the requisite licensing or registration for a Virtual Asset Trading Platform in Hong Kong. This step was taken after BitForex’s sudden offline status, which prevented users from accessing their funds and raised suspicions of fraud.
Furthermore, the SFC has collaborated with the Hong Kong Police Force to request the blocking of BitForex’s website and social media channels. This measure is part of a broader strategy to shield investors from potential scams linked to unlicensed cryptocurrency exchanges.
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