Singapore leads Hong Kong in race to be crypto hub

In 2024, Singapore issued 13 cryptocurrency licenses—more than double the number granted in 2023. Recipients included top exchanges like OKX and Upbit, along with global players such as Anchorage, BitGo, and GSR, according to Bloomberg.

“Hong Kong’s regulatory regime for exchanges is more restrictive in a number of ways that matter — such as custody of customer assets and token listing and delisting policies,” says Angela Ang, senior policy adviser at consultancy TRM Labs. “This may have tipped the balance in Singapore’s favor.”

Hong Kong’s licensing approvals have lagged behind expectations, with only seven platforms fully licensed. Four of these approvals were granted on Dec. 18, but with restrictions.

Additionally, seven platforms hold provisional permits.

Hong Kong enforces a strict regulatory approach to minimize risks for investors and maintain market stability.

“It’s quite a high standard to meet and be profitable,” says Roger Li, co-founder of One Satoshi, a chain of stores in Hong Kong offering over-the-counter crypto-to-cash conversions.

David Rogers, regional chief executive of market maker B2C2 Ltd., has applied for a license in Singapore. He says Hong Kong’s special administrative regime carries a distinct risk profile, whereas Singapore’s supportive digital-asset environment offers a “safe, long-term choice” for a regional hub.

“It is a risk-adjusted approach we are taking here,” he says.

“Singapore’s framework encourages interaction between new entrants and established institutions,” says Ben Charoenwong, associate professor of finance at INSEAD.

In comparison, Hong Kong’s focus on established financial institutions “creates fewer opportunities for new entrants and limits the scope of innovation.”