By
Chimamanda U. Martha
April 26th, 2024
OSL exchange’s parent firm has denied reports that its on sale with an estimated valuation of 1 billion Hong Kong dollars ($128 million).
BC Technology, the parent firm of Hong Kong-based licensed crypto platform OSL, denied reports that the exchange is up for sale.
BC Technology, the parent company of OSL, has refuted Bloomberg’s report on the pending sale as “factually inaccurate and highly misleading” in a statement filed with the Hong Kong Stock Exchange. As per the Bloomberg report, the exchange was on sale with an estimated valuation of 1 billion Hong Kong dollars ($128 million).
Out of all the players, OSL and HashKey are the only two that have obtained cryptocurrency licenses in Hong Kong, as permitted by the new regulations enacted in June. These licenses enable them to cater to retail customers, and it’s noteworthy that the application process incurred costs ranging from $12 million to $20 million.
In a conversation with the South China Morning Post, a representative from BC Technology commented:
“We have observed a growing demand for OSL’s services, particularly in light of the regulatory crackdown on unlicensed and illicit entities in Hong Kong over the past few weeks”.
Hong Kong’s Push into Crypto
Approximately a year ago, Hong Kong declared its ambition to become a prominent virtual asset center, sparking high expectations for the local cryptocurrency market. This endeavor has drawn the interest of numerous exchanges that need to acquire licenses following the implementation of new regulations in June.
Recently, the challenges associated with revitalizing the cryptocurrency industry in the city have become more apparent.
OSL earned the distinction of being Hong Kong’s inaugural cryptocurrency exchange to secure a license from the Securities and Futures Commission (SFC) back in 2020, albeit under a prior voluntary program, which restricted it to serving professional investors exclusively. The recent licensing mandate supersedes the old framework, enabling exchanges to offer cryptocurrencies with substantial market capitalization, like Bitcoin and Ethereum, to retail investors.
This year, both OSL and HashKey saw their licenses upgraded to accommodate retail investors in accordance with the revised policy. To foster market stability and bolster investor trust, Hong Kong regulators introduced the new virtual asset trading platform (VATP) license. So far, just five local exchanges have pursued this licensing option.
The SFC published a list of ongoing applicants following a recent financial scandal related to the JPEX cryptocurrency exchange, which cast a shadow on the city’s ambitions to develop its local crypto industry. The exchange faced allegations of fraud and was associated with over 2,500 complaints, involving approximately HK$1.5 billion in losses.