Blockchain Asset Weekly (7 September 2017)

Gatecoin news & views

How does China’s restrictions on ICOs affect Gatecoin?

Following the People’s Bank of China (PBOC) announcement which declared restrictions on token sales or initial coin offerings (ICOs) conducted in Mainland China, Gatecoin would like to clarify how this affects our business:

  • Gatecoin is based in Hong Kong, a Special Administrative Region (SAR) of the People’s Republic of China, which has separate legal and regulatory frameworks to those of the Mainland. Therefore we are not subject to any of the directives described in the PBOC’s announcement.
  • We have not supported any blockchain token projects based in Mainland China and was not in the process of doing so. Nor do we have the intention to support blockchain token projects based in Mainland China until future regulatory developments.

Read our full statement for additional thoughts on how this will affect global token markets.

How does Hong Kong’s SFC statement on ICOs impact Gatecoin?

A day after the declaration from China, Hong Kong’s Securities and Futures Commission (SFC) also issued a statement on ICOs, which thankfully was much similar to the announcements published by Singapore’s MAS and the U.S.’s SEC rather than the PBOC’s.

In short, depending on the structure and nature of a blockchain token they may be regarded as a security in Hong Kong and therefore subject to local securities regulations. So, given that we are based in Hong Kong how might this statement impact us?

  • Since we enable the secondary market trading of blockchain tokens issued through a crowd sale process, we may be required to comply with the SFC’s licensing and conduct requirements.
  • As we have listed certain tokens which may be categorized as securities by the SFC, we may be required to de-list these or prevent our users based in Hong Kong from buying and selling these tokens.
  • We may be prevented from underwriting future token sales which are based in Hong Kong if that project has not acquired explicit regulatory approval or exemption from the SFC.

Gatecoin has always been in favor of progressive regulation regarding the activities of crypto-token exchanges in Hong Kong and we look forward to complying with any requirements enforced by the SFC that may apply to our business. We have already reached out to the SFC to request detailed clarification on our specific licensing and conduct obligations. When we have received this clarification we will publish a separate statement accordingly.

As Hong Kong looks to position itself as a regional and global fintech hub and to differentiate itself from the rest of China, we would be eager to work more closely with the SFC to help develop the SAR as a welcoming destination for properly structured blockchain token sales.

Blame Paris Hilton

Paris Hilton, became the latest “celebrity” (seriously, what is she famous for?) to endorse an ICO project which fed the mainstream media’s fascination with calling the crypto bubble. The ICO project in question, LydianCoin is led by a disgraced tech entrepreneur who was convicted of domestic violence.

Gatecoin has no intention of supporting projects backed by “celebrities” purely for the purpose of hype and marketing, especially those founded by convicted criminals. Despite some media speculation, we believe it is very unlikely Paris Hilton’s announcement provoked the PBOC to crack down on ICOs in China.

Other celebrities that have endorsed crypto projects include Floyd Mayweather, Dennis Rodman and Mike Tyson. Yes, the former boxer as seen in The Hangover movies, Mike Tyson.

Source: Quartz

Upcoming token sales

Airswap (AIR)

The Gatecoin team is excited to be supporting Airswap (AIR), a decentralized exchange protocol, on their token sale.

Why we chose to work with Airswap

Decentralized exchanges are highly anticipated applications of blockchain technology. Many projects have already explored the approach of a decentralized exchange e.g. Etherdelta, OasisDEX by Maker, NVO, OmiseGo, 0x etc. However, having on-chain order books or on-chain order cancellation is both extremely slow and costly compared to using a centralized exchange.

Airswap will solve this problem by building a peer to peer (P2P) protocol layer called “Swap” on top of the ethereum blockchain, which uses smart contracts to settle transactions on-chain. Order posting, checking and canceling will be handled through the off-chain layer, using an indexer and oracles (see whitepaper for more details).

We expect Airswap’s platform to be the best fit for market makers and high volume traders. The Airswap team consists of experienced financial technologists and traders, and the project is heavily supported by Consensys — the Google of blockchain.

Gatecoin will be listing the project’s AIR token on our exchange once token transfers are enabled (exact date TBC).

What is the AIR token?

The AIR token will be a membership token. Anyone wanting to use the swap protocol with their ethereum address will need to hold the equivalent of USD 10 in AIR in their wallets to be able to trade. AIR token holders will be subject to a lock-up period of a few weeks, which is designed to prevent people from selling AIR as soon as they have made a transaction through the swap protocol. There will, therefore, be strong incentives for all participants to keep USD 10 of AIR in their ethereum wallets at all times, as long as they intend to use the swap protocol.

AIR token sale details

  • Public sale start: 10-Oct
  • Presale cap: USD 15M
  • Public sale cap: USD 20M
  • Total supply sold: 20%
  • Overall market cap: USD 175M
  • Gatecoin investor discount: 15%
  • Public discount: 0% for all

Benefits of participating through Gatecoin

As a Gatecoin client, you will benefit from the certainty of being able to participate in the token sale with an exclusive 15% discount over the public sale price. This means that you will receive 15% more AIR tokens for your ETH vs. public sales participants.

How to participate through Gatecoin

Please email us at the address listed below. Kindly note that the minimum participation amount for this token sale is ETH 30. Participation will be taken into account on a first come first serve basis. The deadline for participation in the AIR token pre-sale is Sunday, 10 September 2017.

Find out more about Airswap:

tokens@gatecoin.com

Current price and 24h volumes for selected trading pairs on Gatecoin

Weekly Blockchain Asset Performance Comparison (7 September 2017)

Trade now at Gatecoin.com

Voices from our community

How Singapore became a hot ICO destination by David Moskowitz, Co-founder and CEO of Indorse

China was right to clamp down on ICOs by Emad Mostaque, Co-Founder of Ananas

Tokens at the Gate: What’s Coming After the ICOs by Noah Jessop of Founder Collective

Tokens at the Gate: What’s Coming After the ICOs by Noah Jessop of Founder Collective

What we’ve been reading

Go Ahead, Try to Stop Initial Coin Offerings (Bloomberg View)

Six global banks join forces to create digital currency (The Financial Times)

ASIC’s Greg Medcraft says traditional bank accounts may be obsolete in a decade (The Australian Financial Review)

The first ICO unicorns are here (TechCrunch)

The promises and pitfalls of blockchain tokens (EJ Insight)

Follow Gatecoin on Twitter and subscribe to our email newsletter.

Many thanks,

The Gatecoin Team

Risk Disclaimer

Trading blockchain assets such as bitcoin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade blockchain assets you should carefully consider your investment objectives, level of experience, and risk appetite. You should be aware of all the risks associated with the trading of blockchain assets, and seek advice from a licensed financial advisor if you have any specific concerns.


Blockchain Asset Weekly (7 September 2017) was originally published in Gatecoin Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

How does China’s restrictions on ICOs affect Gatecoin?

On Monday, 4 September 2017, the People’s Bank of China (PBOC) announced that:

  • All token sales or initial coin offerings (ICO) being conducted in Mainland China are to stop their financing activities with immediate effect
  • The organizations and individuals who have already completed token sales in Mainland China are to make arrangements to repay the funds raised to investors
  • All token sale platforms and secondary token marketplaces based in Mainland China are to stop providing exchange services

How does this affect Gatecoin?

  • Gatecoin is based in Hong Kong, a Special Administrative Region (SAR) of the People’s Republic of China, which has separate legal and regulatory frameworks to those of the Mainland. Therefore we are not subject to any of the directives described in the PBOC’s announcement.
  • We have not supported any blockchain token projects based in Mainland China and was not in the process of doing so. Nor do we have the intention to support blockchain token projects based in Mainland China until future regulatory developments.

What impact will this have on the token-sale market as a whole?

Properly structured token sales which focus on financing innovative and game-changing platforms have happened and will happen outside of China. It is likely as a result of these restrictions in China, that future blockchain token issuers will be more considered as far as regulation is concerned and work closer with lawyers and regulators to avoid any legal ramifications across all major jurisdictions.

The only negative impact of these restrictions is that promising blockchain token projects based outside of China will no longer be looking to reach investors based in the Mainland.

Despite the market crashes over the last 24 hours, it is very likely that ether and bitcoin prices will rebound again in the coming weeks given Mainland China’s less significant weighting in global crypto-token markets.

What affect might this have on global regulations?

Most regulators are unlikely to follow suit as their markets were not exposed to the same number and scale of obviously scam projects that had occurred in Mainland China. We believe advanced economies with more robust legal systems and mature financial regulation will follow the example of Canada and release explicit guidelines for token sales.

Specifically, this means clarifying whether token sales are subject to existing securities regulation and if so what processes are required to comply accordingly or apply for exemptions.

Will Hong Kong regulators follow suit?

Given the Hong Kong Monetary Authority’s (HKMA) inaction after the PBOC’s investigation of bitcoin exchanges earlier this year, it is unlikely that they or the Securities and Futures Commission (SFC) are going to “clamp down” on token sales conducted in the SAR.

For one, only a very small pool of investors in Hong Kong have taken part in token sales, and these investors are already involved in the cryptocurrency market and aware of the risks.

As Hong Kong’s legal system is more robust, we have not seen anywhere near the number of scam projects and illegal fundraising activities as we have in Mainland China, because they simply wouldn’t get away with it here to begin with.

Since Hong Kong looks to position itself as a regional and global fintech hub and to differentiate itself from the rest of China, the regulators here should consider developing the territory as a welcoming destination for properly structured token sales.

How will Gatecoin react to future regulations directed at exchanges based in Hong Kong?

Gatecoin has always been in favour of progressive regulation in Hong Kong and we look forward to complying with any future guidelines enforced by the HKMA and or SFC*.

Our business is already licensed as a Money Service Operator (MSO), which governs our foreign exchange activities, and is regulated by the Hong Kong Customs and Excise Derpartment, which means that we must comply with the latest anti-money laundering (AML) and counter-terrorist financing (CTF) requirements as described in the AMLO.

We maintain our MSO license in the absence of any formal regulations governing cryptocurrency exchanges based in Hong Kong and look forward to positive regulatory developments in the coming months.

The Gatecoin Team

*UPDATE: As of 5 September 2017, the SFC has released a statement regarding the treatment of token sales in Hong Kong and the ‘possible’ requirements of secondary marketplaces. Gatecoin will prepare a statement in response to this announcement at a later time after clarifying our specific licensing obligations with the SFC.


How does China’s restrictions on ICOs affect Gatecoin? was originally published in Gatecoin Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

Provable Solvency Report #41 – August 2017

Coinfloor is a custodian of client bitcoins and we believe that we must set the industry standard for transparency and regular audits. Without proper public accountability, the industry will not be able to grow and mature. This is why we are committed to releasing a Provable Solvency Report every month. Coinfloor is proud to have the longest standing track record among bitcoin exchanges in regards to auditing.

Today we are publishing our 41st monthly Provable Solvency Report with step-by-step validation instructions for your convenience.

As of today, Coinfloor holds a total of 5,324.1443 XBT on behalf of our clients. You are invited to verify that your held bitcoins are included in this balance by following the instructions below.

What does the Provable Solvency Report include?

We started out by creating an obfuscated report of all current client balances (the Solvency Report) and then generated a SHA-256 hash of this report.

We then created a bitcoin transaction to ourselves, that includes all currently held client bitcoins, for a value of 5,784.2804 XBT and included in the output script the OP_RETURN of the SHA-256 hash of the report, proving that at the time of making the solvency report, Coinfloor held all of our clients’ XBT funds. You can verify the amount and details of the transaction on the blockchain.

Key Pieces of information:

Provable Solvency Report #41 (August 31, 2017):
https://s3-eu-west-1.amazonaws.com/provablesolvency/solvency_20170831.txt

SHA-256 Hash of the Provable Solvency Report: ca9b391efa05105ee7ac38ce55c782904db213625e9c8c78ba1a23fa60619bcd

Transaction ID: 6440ab75455562924fab18c71bd6c393af56b7aa0b7474c7a8b811c3af0da33c

View the transaction here:
https://www.blocktrail.com/BTC/tx/6440ab75455562924fab18c71bd6c393af56b7aa0b7474c7a8b811c3af0da33c

Your API authentication cookie:
You will find it in My Account > Dashboard in the Coinfloor signed in view, in the API section (visible only for fully verified accounts).

Where is my cookie?!

Instructions for Validating Solvency Report:

      1. Open the Provable Solvency Report file:

https://s3-eu-west-1.amazonaws.com/provablesolvency/solvency_20170831.txt

      2. Go to

http://www.xorbin.com/tools/sha256-hash-calculator or to your SHA256sum calculating application.

      Copy the entire contents of the solvency report into the SHA-256 generator and calculate the SHA-256 hash of the report.
      3. Go to

https://www.blocktrail.com/BTC/tx/6440ab75455562924fab18c71bd6c393af56b7aa0b7474c7a8b811c3af0da33c

      At the bottom of the page, in the Output Scripts section, you will find the generated hash in the OP_RETURN output script of the transaction that includes all customer bitcoins.
      4. Go to

your local SHA1sum application

      to calculate the SHA-1 digest of a message consisting of the timestamp shown at the top of the Solvency Report (1450361333) and your API authentication cookie.
      Example (Linux):
                timestamp: 1450361333
                API authentication cookie (API Key): 9BTa7M0Z/Mrk6tFMJwEkTV3BQek=
                command: echo -n ‘1450361333BTa7M0Z/Mrk6tFMJwEkTV3BQek=’ | sha1sum
      5. Find the resulting hash in the solvency report. Your balance is shown on that line in satoshi units. 1 bitcoin = 100 000 000 satoshis. For your convenience, here is a link to a bitcoin unit converter:

http://www.satoshi.24ex.com

We believe that this approach is the best way to achieve maximum accountability while retaining privacy for our clients. We welcome your feedback and hope that in time, other exchanges will also help safeguard client funds by providing proof of solvency reports to their users on regular basis.

Thank you for your trust,

Coinfloor Team

An introduction to TenX

What is TenX?

TenX is a real world debit card that works with both Visa and MasterCard payment systems and allows users to spend cryptocurrencies such as Bitcoin, Ether and DASH anywhere that Visa or MasterCard is accepted. TenX has also developed an iPhone, Android and desktop app that helps card users to keep track of their transactions and their spending.

How TenX works

How is TenX different from a normal debit card?

Aside from enabling you to spend your cryptocurrency balances, TenX’s business model functions the same way as a mainstream debit card. TenX profits from charging a small fee from every transaction made with a TenX debit card or through its app.

The merchant processing the card transaction charges a fee that will be allocated to:

  • The merchant’s partner bank
  • Visa or MasterCard
  • TenX, the issuer of the card.
TenX’s business model

The benefits of using TenX

Part of the fees that TenX will get from each card transaction will be redistributed in three different ways.

  • TenX will keep one third to ensure a stable revenue stream. The remaining two thirds of fees will be distributed to:
  • TenX’s PAY token holders, who will be rewarded 0.5% payed out in ETH, for every transaction and
  • TenX card holders, who will receive 0.1% per transaction in PAY tokens through the TenX app.

You can buy and trade TenX’s PAY token at Gatecoin.com

TenX’s reward structure for card and token holders

How does a TenX transaction work?

When making a payment, the TenX card user can choose between different blockchain assets as a source of payment such BTC, ETH, DASH etc. within the TenX app. When the transaction takes place, the conversion into the merchant’s local fiat currency occurs in real-time. The video below provides a great demonstration of a TenX’ payment.

https://medium.com/media/6d3c7afa8653734dec529b3afba45844/href

How does TenX keep user funds secure?

The TenX app enables users to lock or unlock usage of the TenX card. The app also allows other security measures like daily spending limits and withdrawal restrictions. This enables TenX to compete with traditional debit cards on security.

The TenX PAY token sale

When the TenX team launched its PAY token sale on June 24th 2017 it already had a working product, the multi-blockchain asset, “TenX Wallet.”

The PAY token sale successfully achieved its ETH 200,000 goal, and raised an additional ETH 45,000 given the widespread interest in the TenX card. This additional ETH was allocated to provide further liquidity to the TenX ecosystem.

The total amount raised during the PAY token sale amounted to more than USD 80 million equivalent with USD 34 million raised during the during pre-sale period.

A total of 20 million PAY tokens were created during the token sale period and were distributed as follows:

  • 51% offered to the public through the token sale
  • 29% Retained by TenX to be distributed to community initiatives, business development, academic research and market expansion. For the next four years this budget will be securely held in publicly viewable cryptocurrency wallets and are subject to scrutiny by the entire community according to TenX whitepaper.
Funds allocation
  • 20% Distributed among founders, employees and early investors

The purpose of the PAY token sale was to enable community participation in the TenX project by owning a stake in its ecosystem. The funds raised were initially used by the TenX team to hire more engineering and business talent that will work on developing a sophisticated product ecosystem; including applications for android, iOS and desktop, a multi-card platform and integration of various cryptocurrencies and tokens.

The PAY token sale also facilitated the distribution of PAY tokens to users of the existing TenX Wallet.

As the TenX debit card has already been distributed to users, fee rewards from card transactions can be claimed by PAY token holders here.

How does the TenX payment system work?

TenX’s payment system is based on the Cryptographically-secure Off-chain Multi-asset Instant Transaction network (COMIT).

As the name implies, COMIT is a cross-chain payment channel, which allows different blockchains like bitcoin and ethereum to interact together without the need to issue a different token.

This enables TenX Wallet users to directly transfer blockchain assets, peer to peer without a centralized intermediary.

What is the company behind TenX?

TenX Pte. Ltd. is the Singapore-based company behind the development of the TenX ecosystem. The firm is an alumni of PayPal’s incubator programme “Start Tank”, won first place at the DBS and IBM sponsored Blockchain Hackaton, and is supported by Citibank through its Citi Mobile Challenge in Asia Pacific. Early investors in TenX include Ethereum Founder, Vitalik Buterin, Fenbushi Capital’s Bo Shen and angel investor David Lee.

Who are the TenX team?

TenX’s four co-founders come from different backgrounds. Toby Hoenish, CEO, has a strong track record of founding and managing startups across the world like Tokyo based, Studypack. Paul Kitti, COO, has extensive experience in design innovation and product development. Dr. Julian Hosp, CVO, is a former medical physician, professional Kite surfer and the author of the best selling book I-Unlimited. Michael Sperk, CTO, has a PhD in Bioinformatics and an Msc. Computer Science and prior to co-founding TenX developed a scalable browser based Visual Analysis Tool, capable of processing and visualizing hundreds of thousands of social media messages in real time.

The TenX founders spend up to two thirds of their working time engaging with their current and prospective card users and token holders through social channels. TenX has a very active Youtube channel where they often upload videos of all kinds — tutorials, news, vlogs, industry topics and recordings from meetups. If you want to catch up with the latest release or news make sure to check out TenX’s twitter account or join their weekly discussion on their official subreddit.

Recent Developments

TenX announced in August 2017 that they have become members of the Enterprise Ethereum Alliance (EEA).


An introduction to TenX was originally published in Gatecoin Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

Blockchain Asset Weekly (31 August 2017)

Gatecoin news & views

New tokens listed on Gatecoin

Gatecoin is pleased to announce support for the following projects by listing their tokens on our exchange:

  • InvestFeed (IFT) — a cryptocurrency social network
  • MobileGo (MGO) — a cryptocentric mobile gaming platform
  • 0x (ZRX) — an open protocol for decentralized exchanges built on ethereum

All the above tokens can be traded with BTC and ETH.

All new ATHs!

The price of bitcoin and litecoin soared to all-time highs (ATHs) this week, rising above USD 4700 and USD 65 respectively. Many market watchers pointed to the surging volumes on exchanges based in South Korea as a major cause for these price rallies, which our Head of Marketing speaking to CNBC believes is due to regulatory developments in the nation.

Canada clarifies guidelines for token sales

Canada, obviously one of the most important financial markets in the world, published a detailed report on cryptocurrency offerings which included very specific guidelines for technopreneurs looking to raise capital through token sales.

Prepared by the Canadian Securities Administrators (CSA), this is the only communication so far from any regulator that explicitly describes the legal obligations of token issuers. In short, token issuers should follow existing Canadian security issuance requirements, regardless of the token’s value proposition, or apply for an exemption. Past announcements from the U.S. SEC or Singapore’s MAS contained no concrete guidelines and their recommendations were ambiguously broad, which can be summarized as “hire a lawyer.”

Gatecoin is not impacted by the CSA’s announcement given that we have no operations in Canada and have not listed any tokens tied to a Canadian legal entity. In fact, we are glad that a regulator finally spelled out exactly what they want from token issuers.

China’s regulators expected to release guidelines for token sales

As reported by Tencent Finance and China’s leading financial media organization Caixin, regulators in China are currently discussing the development of guidelines for token sales conducted in the country. This may include limits on the size of token sales, more stringent information disclosures and the publishing of regular investment risk alerts.

The National Internet Finance Association of China subsequently released a statementcalling for greater due diligence and risk assessment of token sales.

Gatecoin believes such guidelines will be positive for the future development of the blockchain ecosystem in China.

The Securities and Futures Commission (SFC) of Hong Kong, where Gatecoin is based, has yet to release any communications regarding the requirements for token sales conducted in the Special Administrative Region (SAR) which has different legal and regulatory regimes to the rest of China.

Current price and 24h volumes for selected trading pairs on Gatecoin

Weekly Blockchain Asset Performance Comparison (31 August 2017)

Trade now at Gatecoin.com

Voices from our community

Why I Was Wrong About Segwit And Big Blocks by Jimmy Song, Bitcoin Developer

Decentralized social media is peer-to-peering into the future by Jake Brukhman, Co-Founder of Coinfund

We need more public due diligencefor ICOs by Stefano Bernardi, Managing Partner Mission & Market

Ethereum blockchain dominates CoinMarketCap by CryptoPortfolio

What we’ve been reading

Central Banks Can’t Ignore the Cryptocurrency Boom (Bloomberg)

Why Quantum Computing’s Threat To Bitcoin And Blockchain Is A Long Way Off (Forbes)

Why initial coin offerings are exploding — and how companies can avoid the landmines (Silicon Angle)

Want blockchain success? Developers, developers, developers (VentureBeat)

Follow Gatecoin on Twitter and subscribe to our email newsletter.

Many thanks,

The Gatecoin Team

Risk Disclaimer

Trading blockchain assets such as bitcoin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade blockchain assets you should carefully consider your investment objectives, level of experience, and risk appetite. You should be aware of all the risks associated with the trading of blockchain assets, and seek advice from a licensed financial advisor if you have any specific concerns.


Blockchain Asset Weekly (31 August 2017) was originally published in Gatecoin Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

How to buy bitcoin in Hong Kong

By Michelle Tam, Marketing Intern (Summer 2017)

Bitcoin is becoming increasingly popular as an alternative investment in Hong Kong, due to its low barriers to entry and phenomenal (albeit volatile) increase in value over the last few years and months.

Average USD market price across major bitcoin exchanges.

Even the local Hong Kong media report regularly on bitcoin’s price, the updates to its software and the other technologies that it has inspired.

Globally, bitcoin and other crypto-assets are being formally recognized by governments and new regulations have been released in major economies such as Japan and Australia to govern the activities of bitcoin exchanges. This is encouraging more mainstream interest in bitcoin, as prospective investors see the actions by these governments as signs of bitcoin’s legitimization in society.

Hong Kong still has no formal regulatory regime for the activities of bitcoin exchanges and the HKMA has designated the technology as a virtual commodity, rather than a payments network or digital currency. This creates both opportunities and a void of uncertainty for businesses wishing to offer bitcoin related services in the SAR and for their prospective clients, who may be weary of the lack of regulation.

So, given the regulatory uncertainty, why should Hong Kong residents engage with bitcoin, either as a digital currency or as an investment?

Bitcoin — the ideal payment app for Hong Kong’s globalized, jet-setting and well-connected population:

Image source: bitcoins.com

Faster transfers: thanks to a new feature of bitcoin, called Payment Channels, you can now conduct instant transactions, unlike with traditional banking services. This makes payments between friends, family, suppliers and customers much more efficient, and perfectly suits Hong Kong’s status as a global commercial hub.

Cheaper transfers: bitcoin is a decentralized peer to peer payments network, with no intermediaries charging additional fees, therefore the cost of transacting through Payment Channels are minimal, especially for cross-border transactions. As a gateway to China and the rest of Asia, low-cost, cross-border transfers are essential for boosting the competitiveness of Hong Kong businesses in the internet age.

Secure transfers: records of all bitcoin transactions are validated and maintained by a distributed network of “miners” who contribute their computing power to ensure that no one can conduct false transactions. The security of your bitcoin funds, depends on how you manage your private key rather than relying on third party custodial services. This ensures the reliability of payments, helping to boost Hong Kong’s status as a safe jurisdiction for financial services.

Global transfers: Hong Kongers love to travel — 70 percent of Hong Kong’s vacationing population will spend on average 14 days overseas per year. As bitcoin can be used anywhere in the world, it makes it the ideal payment method for Hong Kong’s globetrotters. There are now several debit cards enabling you to spend bitcoin wherever Visa or MasterCard is accepted, such as TenX and Monaco so that you don’t have to worry about credit card conversion fees when you travel. In 2015, a programmer called Felix Weis traveled around the world for 18 months spending only Bitcoin. This shows how far Bitcoin travel has come and the degree to which it is accepted internationally.

Bitcoin — a new alternative asset for Hong Kong’s tech savvy investors

Low barriers to entry: unlike with most traditional investments such as property or major stocks, there is no minimum amount required to invest in bitcoin. You can buy as little as HKD 1 or as much as HKD 1 billion worth of bitcoin. Although today the bitcoin price is worth more than several thousand USD, one bitcoin is divisible to 0.00000001, so there will always be an affordable entry point. The same cannot be said about housing in Hong Kong!

Easily liquidated: when you want to sell an investment such as a stock, gold, or an apartment, the process can be time consuming and laborious. You’d typically need to go through a broker, pawn shop or property agent. For bitcoin, you can easily sell your stake on a reputable exchange, such as Gatecoin, at any time 24/7.

Easily stored: bitcoin can be stored on several web, mobile and desktop wallet apps or more securely in hardware wallets which are not connected to the internet. This means that you can easily store and transport your investment anywhere. The same cannot be said for bars of gold or apartments on the 50th floor!

Future potential: bitcoin is still a very early stage technology (the software was released in 2009), and yet has already gained a large community of users. As bitcoin’s technology improves, making it more competitive as a payments network, secure store of value and computing platform, more businesses and individuals are likely to engage with it. Government regulation of bitcoin exchanges will add to the technology’s long-term legitimacy and will attract larger liquidity from institutional investors which is likely to add to its overall value.

IMPORTANT: Of course, like with most assets, investing in bitcoin comes with a high degree of risk. Due to bitcoin’s historical volatility, it is wise not to invest more than you are comfortable losing.

So, now that you are excited to engage with bitcoin as a payment protocol or investment, how can you get your hands on bitcoin in Hong Kong?

Step 1: Go to Gatecoin.com— Gatecoin is a bitcoin exchange headquartered in Hong Kong that enables you to buy and sell bitcoin (BTC) with HKD and USD. Gatecoin is licensed as a Money Service Operator (MSO), which governs the exchange’s foreign exchange activities, and is regulated by the Hong Kong Customs and Excise Department. Therefore the exchange enforces stringent know-your-customer (KYC) and anti-money-laundering (AML) policies. This is designed to demonstrate the firm’s adherence to global AML best practices in the absence of any formal guidelines for bitcoin exchanges in Hong Kong.

Step 2: Create an account on Gatecoin. Start off by filling in your personal and contact details:

Step 3: You will receive an email verification from Gatecoin. Click the link and continue the registration process:

Step 4: You will be required to upload a scan or photo of a government issued-ID and proof of residence:

Once submitted, Gatecoin’s compliance team will review and verify your account within two business days.

Step 5: Once verified, you can fund your account through HKD or USD bank transfers. After the funds arrive on Gatecoin’s bank account the amount transferred will be credited to your Gatecoin account within two business days.

Step 6: You can now easily buy/sell bitcoin using the exchange’s trading platform at the prices and quantities displayed in the exchange’s order book!

For purchasing larger amounts of bitcoin, the Gatecoin team also offers off-exchange transactions through their OTC trading desk.

Click here to find out more about buying bitcoin through Gatecoin in Hong Kong.

To learn more about bitcoin, visit Gatecoin’s bitcoin page.

I hope you found this article useful!

Thanks for reading,

Michelle Tam


How to buy bitcoin in Hong Kong was originally published in Gatecoin Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.