Singapore’s stance on crypto licenses has outpaced Hong Kong, where regulatory hurdles have slowed the city’s progress.

Singapore is signaling progress in becoming a global hub for the crypto business as the city-state granted 13 new crypto licenses in 2024, doubling the number issued last year, Bloomberg has learned.

The licenses went mainly to large exchanges like OKX and Upbit, as well as other firms like Anchorage, BitGo, and GSR. At the same time, Hong Kong has faced delays in its effort to catch up, with its licensing process moving slowly, the report notes, adding that both cities aim to attract digital-asset firms by offering special regulatory regimes, tokenization projects, and innovation-focused sandboxes.

As noted Angela Ang, senior policy adviser at blockchain forensic firm TRM Labs, Hong Kong’s regulatory regime for exchanges “is more restrictive in a number of ways that matter — such as custody of customer assets and token listing and delisting policies,” adding further that this “may have tipped the balance in Singapore’s favor.”

Hong Kong has fully licensed seven platforms, including four that were approved in December with some restrictions. However, exchanges like OKX and Bybit, withdrew their applications without explaining the reason for doing so. Due to its cautionary approach, Hong Kong allows only the most liquid cryptocurrencies for trading, such as Bitcoin (BTC) and Ethereum (ETH), and restricts trading in smaller, more volatile tokens.

Bloomberg says another factor that is limiting Hong Kong’s ability to stay competitive in the space is the influence of China, where crypto trading is banned. Hong Kong’s special relationship with China gives it a different risk profile compared to other countries, says David Rogers, regional chief executive at market maker B2C2. Per Rogers, Singapore’s supportive environment makes it a “safe, long-term choice” for a regional hub.