Hong Kong’s Digital Asset Regulatory Framework: A New Era for Crypto Governance

In a significant move toward regulating the burgeoning digital asset sector, the Hong Kong Securities and Futures Commission (SFC) has announced plans to finalize a comprehensive regulatory framework by next year. CEO Liang Fengyi emphasized this commitment in a recent interview with Hong Kong 01, framing it as part of the SFC’s broader mandate to uphold market integrity while fostering innovation.

Liang’s remarks coincide with the SFC’s 35th anniversary, during which the commission has reaffirmed its dedication to advancing strategic priorities. Among these is the establishment of a robust regulatory environment for virtual asset trading platforms. Currently, three platforms—Hong Kong Virtual Asset Exchange (HKVAX), OSL Exchange, and HashKey Exchange—have successfully secured licenses. Additionally, 11 more platforms are navigating the licensing process, with initial assessments completed. Liang underscored that applicants failing to meet regulatory standards will forfeit their licensing eligibility, while those who comply may be granted conditional licenses.

Looking ahead, the SFC aims to enhance the resilience of the market and bolster the global competitiveness of Hong Kong’s capital markets. Liang also highlighted initiatives to promote the tokenization of traditional financial products and to integrate regional blockchain technologies and Web3 solutions into the financial landscape.

Moreover, the SFC is developing a licensing framework for cryptocurrency over-the-counter (OTC) services, marking another step in its regulatory evolution. This multifaceted approach positions Hong Kong as a forward-thinking player in the global digital asset arena, balancing the need for regulation with the imperative for innovation.

Hong Kong Securities and Futures Commission (SFC) Official Website: SFC Website