In a statement released today, the Hong Kong Securities and Futures Commission (SFC) said it has warned seven cryptocurrency exchanges that some of the tokens traded on its platform may be defined as "securities." Although the names of these exchanges were not disclosed, the SFC said they are either based in Hong Kong or linked to Hong Kong and ranked in the top 20 globally.
"The statement said the SFC warned investors about the risks of trading cryptocurrencies, a move that is only part of the deal. Last September, Hong Kong Securities and Futures Commission warned ICO financing model may be at risk, the current move is relatively mild."
It is worth noting that the Hong Kong Securities and Futures Commission said the investigation may take further action but so far all the exchanges that have received the notification have responded to the investigation.
Hong Kong-side news said: "Most of these cryptocurrencies exchanges have confirmed that no cryptocurrency trading services have been provided or that corrective measures have been taken immediately, such as removing the cryptocurrencies on the platform."
The SFC sent a letter to seven unnamed ICO organizers who are soliciting investors in Hong Kong and whose tokens are considered securities by the agency.
Take a step back and said this happened after the CSRC and the Hong Kong government established a cooperative relationship. It is also after these two agencies publicized their activities on the potential risks of encryption money, fraud and hacking issues.