Key Takeaways:
Hong Kong’s securities watchdog added two more companies to its warning list, citing unlicensed activity and the promotion of services that allegedly allow investors to use virtual currencies to subscribe to initial public offerings.
"In fact, neither StableStock nor HabitTrade are licensed by the SFC and are prohibited from engaging in any regulated activities in Hong Kong," the Securities and Futures Commission (SFC) said in a May 8 statement. The regulator noted it had seen online videos enticing the public to use the StableStock platform, which claimed to be partnering with HabitTrade.
HabitTrade pushed back on the allegations, stating it "has not conducted any regulated business in Hong Kong, nor promoted or provided related services to the public in Hong Kong." The firm, which describes itself as a licensed Australian brokerage, blamed unauthorized third-party promoters for the marketing content and said it reserves the right to take legal action against entities misusing its brand.
The action is part of a broader, aggressive enforcement stance in Hong Kong, which is trying to establish itself as a regulated hub for digital assets while clamping down on illicit activities. The SFC's move against StableStock and HabitTrade follows a recent warning about fraudulent stablecoins using the brand names of licensed issuers like HSBC, and a separate action against the platform MEXC for serving Hong Kong clients without a license. Under the city's tightening rules, any foreign platform "targeting" Hong Kong investors through marketing is considered within the SFC's regulatory scope, a policy that carries significant legal and reputational risk for firms deemed non-compliant.
This article is for informational purposes only and does not constitute investment advice.
