Hong Kong Gov't Report Says Bitcoin Poses 'Medium-Low' Risk In Financial Crime

The Hong Kong Financial Services and Treasury released a report yesterday, April 30, on the status of money laundering and terrorism financing.

The report concluded that virtual currencies, like Bitcoin, are not particularly involved in either type of financial crime.

The FSTB notes that "Although there is inherent ML/TF vulnerability related to VCs":. "There does not seem to be any visible impact affecting the overall risk in Hong Kong so far. The risk of VCs is assessed as medium-low."

The report does mention the use of cryptocurrencies in Ponzi schemes and cybercrimes - specifically mentioning the WannaCry attack - citing 167 Bitcoin related police reports from 2013-2017.

According to the report, cryptocurrencies are not considered legal tender in Hong Kong.

"The exchange of Bitcoin in person is not popular Domestically, the use of Bitcoin remains at a negligible level."

The report writes that the Bitcoin ATMs in Hong Kong are also "Not popularly used by people in Hong Kong.".

As a comparison, in Venezuela - a country whose economy is currently experiencing hyperinflation - many citizens have begun to rely on Bitcoin as a more stable store of value as compared to their national currency.

In February of this year, Hong Kong's Securities and Futures Commission warned potential crypto investors that they would keep "Policing" cryptocurrency and ICO markets.

In mid-March, the SFC halted an ICO in Hong Kong and made the company return the money raised, on the grounds that it was an unregistered investment scheme.