Bitcoin surges as Hong Kong gives green light

Hong Kong’s Securities and Futures Commission (SFC) announced that it would accept applications from exchanges to offer crypto trading to retail investors from June 1, adding that approved tokens need a 12-month track record and substantial market capitalization.

The SFC said registered exchanges would be barred from providing stablecoin and interest-bearing instruments. The announcement is consistent with long-held expectations that developments in Asia will catalyze the next crypto bull run and contrasts the lack of regularity in the West, particularly in the U.S.

Bitcoin picked up a bid during the Asian hours and rose more than 2% to $27,500, probing the former support-turned-resistance of the horizontal trendline connecting the first and second trough of the head-and-shoulders (H&S) pattern.

The cryptocurrency fell below the trendline early this month, confirming the H&S breakdown and opening doors for a deeper slide toward $25,000. Hong Kong’s decision to green light crypto trading for retail investors does not mean there will be a flood of demand for cryptocurrencies, as local traders are probably already accessing the market through offshore venues. Nevertheless, the announcement is a a welcome reminder that the crypto adoption pool is likely to grow considerably over the next year and beyond.