A regulatory licensing regime is a system established by government authorities that requires digital asset businesses to obtain specific permits or licenses to operate legally. These regimes typically impose requirements related to capital reserves, anti-money laundering compliance, cybersecurity, and consumer protection. They aim to supervise and control market participants.
Context
The implementation and evolution of regulatory licensing regimes are a dominant theme in global cryptocurrency news, as jurisdictions seek to manage the risks associated with digital assets. Debates often surround the scope of these regulations, their impact on innovation, and the challenges of cross-border enforcement. The clarity provided by a well-defined licensing regime can significantly influence market growth and institutional participation.
The Hong Kong Monetary Authority established a high-bar licensing regime for fiat-referenced stablecoins, mandating robust capital and asset segregation to mitigate systemic risk.
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