The Hong Kong Securities and Futures Commission (SFC) has reportedly relaxed one of its crypto regulations by lowering the mandated insurance coverage on digital assets to 50%. OSL, one of the approved crypto exchanges in Hong Kong, stated that despite the reduction in requirements by the SFC, it remains committed to safeguarding at least 95% of regulated assets under custody. The move aims to address the market’s volatility and the collapse of several cryptocurrency firms in recent years, emphasizing the importance of robust insurance coverage. OSL has taken out a 2-year digital asset custody policy with Canopius to enhance client protection.
The SFC’s decision to lower the insurance coverage requirement indicates a regulatory adjustment to accommodate the evolving dynamics of the crypto market. While the move aims to provide flexibility, it also underscores the importance of insurance in mitigating risks for crypto investors. OSL’s commitment to maintaining a high insurance ratio demonstrates a proactive approach to addressing potential challenges and maintaining market integrity. The insurance landscape for digital assets is likely to continue evolving, with a focus on balancing regulatory requirements and industry practices. (Source:beincrypto)
