Cryptocurrency prices moved higher on Tuesday after Hong Kong’s securities regulator announced it will allow retail trading of certain crypto assets starting June 1.
Bitcoin rose 1.7% to $27,293.64, according to Coin Metrics. The largest cryptocurrency has been trading in a small range throughout May, struggling to break meaningfully above $30,000 but staying above $25,000. Ether advanced more than 2% to $1,855.28.
Late Monday night, Hong Kong’s Securities and Futures Commission said it would allow retail investors to trade certain crypto assets beginning next month on registered trading platforms. The move was widely expected, with the announcement marking the end of a request for public comment it put out in February on its proposed regulatory requirements around retail trading in crypto.
The new guidelines are part of a broader effort of Hong Kong’s to become a global crypto hub. That ambition is in sharp contrast with China, which banned crypto trading in 2021, as well as the U.S. where the regulatory stance toward crypto has turned hostile since the collapse of FTX.
“This news doesn’t mean that a flood of retail buying power will enter the market at the beginning of June. … We could see some volume uptick in June, however,” said Noelle Acheson, economist and author of the “Crypto is Macro Now” newsletter.
Hong Kong’s Securities and Futures Commission has already licensed two digital asset platforms, OSL and Hash Blockchain, and it’s likely some are already actively trading offshore, Acheson said.
Owen Lau, an analyst at Oppenheimer, called Hong Kong “pretty aggressive” for trying to become a crypto hub.
“It will continue to capture the attention of the community and attract more firms to set up offices in Hong Kong,” he said. “It is hard to gauge the exact impact but it has a long-term effect on capital flow and talent movement.”
Both crypto assets have struggled to make meaningful moves in either direction in May. While the market has been lacking in big catalysts and investors are closely watching the debt ceiling negotiations, trading has been relatively still and bitcoin has returned to behaving like a risk asset.
This story originally appeared on CNBC
