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POLICY AND PRACTICE REVIEWS article

Front. Blockchain
Sec. Financial Blockchain
Volume 7 - 2024 | doi: 10.3389/fbloc.2024.1492739

The JPEX Scandal: A Test Case for Hong Kong's New Cryptocurrency Regulatory Regime Or Is It Still the Wild West?

Provisionally accepted
Noble Po Kan Lo Noble Po Kan Lo 1,2*Tony Hon Yiu Lau Tony Hon Yiu Lau 3,4
  • 1 College of Professional and Continuing Education, Hong Kong Polytechnic University, Hong Kong, Hong Kong, SAR China
  • 2 Department of Educational Research, Faculty of Arts and Social Sciences, Lancaster University, Lancaster, England, United Kingdom
  • 3 Lau, Horton & Wise LLP, in Association with CMS Hasche Sigle, Hong Kong LLP, Hong Kong, China
  • 4 Faculty of Law, The University of Hong Kong, Pokfulam, Hong Kong, SAR China

The final, formatted version of the article will be published soon.

    This paper inves gates the challenges and effec veness of Hong Kong's regulatory framework for digital assets and cryptocurrencies in the wake of the JPEX Scandal. The scandal serves as the first significant test of the city's regulatory measures aimed at protec ng consumers and investors from fraudulent ac vi es within the crypto space. The study delves into the background and development of blockchain technology and cryptocurrencies, highligh ng their rapid evolu on and the associated regulatory challenges. By examining the JPEX case, the paper evaluates the robustness of Hong Kong's regulatory tools and their ability to balance consumer protec on with fostering innova on. The paper employs a doctrinal legal methodology, supplemented by a case study of JPEX, to assess whether the current regulatory framework is adequate or if further adjustments are required. The findings suggest that while significant strides have been made, certain gaps remain, par cularly concerning decentralised finance (DeFi) and decentralised autonomous organisa ons (DAOs). The paper concludes with recommenda ons for enhancing regulatory clarity and ensuring the sustainable growth of Hong Kong as a global crypto hub.

    Keywords: Cryptocurrency Regula on, JPEX, Blockchain technology, Hong Kong Securi es and Futures Commission, Decentralised Finance, Decentralised Autonomous Organiza ons

    Received: 07 Sep 2024; Accepted: 31 Oct 2024.

    Copyright: © 2024 Lo and Lau. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY). The use, distribution or reproduction in other forums is permitted, provided the original author(s) or licensor are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.

    * Correspondence: Noble Po Kan Lo, College of Professional and Continuing Education, Hong Kong Polytechnic University, Hong Kong, Hong Kong, SAR China

    Disclaimer: All claims expressed in this article are solely those of the authors and do not necessarily represent those of their affiliated organizations, or those of the publisher, the editors and the reviewers. Any product that may be evaluated in this article or claim that may be made by its manufacturer is not guaranteed or endorsed by the publisher.