Is Buying Tether (USDT) Legal in Hong Kong?

Yes, it's completely legal to buy and trade Tether (USDT) in Hong Kong. Residents can purchase USDT through digital asset exchanges regulated by the Securities and Futures Commission (SFC).

To buy USDT securely, local traders should use crypto platforms in Hong Kong licensed by the SFC, as they are mandated to follow strict Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations. Investors should remain updated on guidelines issued by both the SFC and the Hong Kong Monetary Authority (HKMA) to ensure regulatory compliance.

How to Buy USDT in Hong Kong

Purchasing Tether (USDT) in Hong Kong is possible by using regulated exchanges like Kraken, which provides deep liquidity and maintains strong compliance with global regulatory standards.

Users can deposit funds to Kraken using bank transfers (SWIFT), Faster Payment System (FPS), or debit and credit cards. There are over 400 cryptocurrencies available for trading and staking.

Here’s how to safely buy USDT with Kraken in Hong Kong:

1. Register an Account: Visit Kraken’s website and create your personal or corporate account by providing basic registration details.
2. Complete Verification: Verify your identity through the KYC procedure. Upload clear images of your Hong Kong ID card, passport, or other valid identification documents, along with the requested personal information.
3. Deposit Hong Kong Dollars (HKD): Log into your account, click the “Deposit” option, select HKD as your deposit currency, and fund your account using your chosen payment method, such as bank wire or card transfer.
4. Purchase USDT: Once your account has funds available, navigate to the HKD-USDT trading pair, enter your desired purchase amount, and complete the trade.

Best Exchanges to Buy USDT in Hong Kong

Several reputable platforms are available for those searching for the safest way to buy Tether (USDT) with Hong Kong dollars (HKD). Kraken, Hashkey, BloFin, and Gate.io are the leading options, offering strong security practices and convenient HKD payment options.

To simplify your choice, here’s a clear breakdown of the top exchanges for buying USDT in Hong Kong:

HKD to USDT Fees

When buying Tether (USDT) with Hong Kong dollars (HKD), investors need to understand the typical costs associated with different crypto platforms. Here’s a simple overview of the fees involved:

• Deposit Fees: Deposits in HKD via bank transfers from local banks like HSBC typically incur minimal charges. Using credit or debit cards generally attracts higher fees, usually around 1.5% to 3%, depending on your bank or card provider.
• Withdrawal Fees: Withdrawing HKD from exchanges back into your bank account often involves modest charges, commonly ranging from HK$0 to HK$20 per transaction.
• Trading Fees: Exchanges such as Kraken use a maker-taker pricing model, charging low fees of 0.16% for makers and 0.26% for takers. Other platforms, like Hashkey and BloFin, have set trading fees typically ranging between 0.2% and 0.5%.

To keep your overall transaction costs low, use bank transfers when depositing HKD, and select exchanges recognized for transparent and competitive pricing structures.

Tax Considerations for Tether in Hong Kong

In Hong Kong, holding Tether (USDT) or other cryptocurrencies is not subject to capital gains tax. The Inland Revenue Department (IRD) does not tax profits from the sale of capital assets, including digital tokens held for long-term investment purposes.

However, if you engage in frequent trading of USDT or other cryptocurrencies, the IRD may classify your activities as a business, making the profits subject to profits tax. The determination depends on factors such as the frequency and volume of transactions, the intention behind the trades, and the level of organization involved.

It's essential to maintain detailed records of all cryptocurrency transactions, including dates, amounts, and the purpose of each transaction. Consulting with a tax professional familiar with Hong Kong's crypto tax landscape can provide further guidance for your circumstances.

About Tether (USDT)

Tether (USDT) is the world's most widely adopted stablecoin, designed to maintain a 1:1 value with the U.S. dollar. Hong Kong traders and investors often rely on USDT for its stability, ease of transaction across major exchanges, and its ability to hedge against crypto market volatility.

While Tether's issuer claims the stablecoin is fully backed by reserves, including cash and treasury instruments, questions about reserve transparency have periodically arisen. Despite this scrutiny, USDT continues to be integral in Hong Kong's crypto market, offering liquidity and stability to local investors navigating both global and regional market fluctuations.

Final Thoughts

Buying Tether (USDT) in Hong Kong is straightforward when using SFC-regulated platforms like Kraken, Hashkey, or BloFin. However, the key to an easy investment experience is selecting an exchange with transparent fee structures and convenient HKD payment options. 

Stay proactive by regularly reviewing regulatory updates from the SFC and HKMA, keeping detailed records for tax purposes, and always prioritize platforms known for reliability.