2/N

As a government department, the China Securities Regulatory Commission’s power comes from the power granted by the law. The reason why it has not carried out supervision before is because there is no corresponding power granted by the law. The administrative department should not violate the law and cross the line.

The source of SFC's regulatory power this time is the revised "Regulations on Combating Money Laundering" in December 2022. Through this legislation, trading service platforms for security tokens also need to be licensed and supervised by the Securities Regulatory Commission.

Review timeline:

In 2018, the China Securities Regulatory Commission has realized that the risks of virtual assets are not only money laundering, but also investor protection;

In 2019, the China Securities Regulatory Commission proposed a voluntary regulatory framework to manage security token trading service platforms;

In 2020, the Hong Kong government released a revised document on the Anti-Money Laundering Ordinance to solicit opinions. It is recommended that the trading services of non-security tokens be also included in the management of the China Securities Regulatory Commission; #hongkongweb3