Hong Kong is set to make a major move in the global crypto sector by allowing locally licensed crypto exchanges to access international capital pools. This regulatory change is designed to strengthen Hong Kong’s position as a leading digital asset hub while ensuring robust investor protection and market integrity.
The city’s Securities and Futures Commission (SFC) is finalizing updated rules for crypto dealer and custodian licensing. Starting next year, the Hong Kong Monetary Authority (HKMA) will begin issuing the first licenses for stablecoin issuers, integrating stablecoins into the regulated financial ecosystem. In addition, there are plans to permit locally licensed crypto brokers to access global liquidity pools. If enacted, these reforms would make it easier for major exchanges and brokerages, such as Binance and Coinbase, to set up operations in Hong Kong, using broker licenses that are faster to obtain than full exchange licenses.
Hong Kong has already approved 11 fully licensed crypto exchanges and authorized 49 brokers to offer virtual asset services under omnibus account arrangements. Regulatory relaxations introduced by the SFC now allow licensed exchanges to list new tokens and stablecoins, giving professional investors more trading options. Importantly, these tokens can be listed without the previous requirement of a 12-month track record of issuance or meeting strict liquidity criteria, further enhancing market flexibility.
With these policy changes, Hong Kong is not only expanding access to digital assets but also tightening oversight. New custody standards have been introduced to ensure client assets are securely managed, including requirements for cold wallet operations and real-time threat monitoring. These efforts reflect Hong Kong’s commitment to balancing market development with rigorous safeguards, distinguishing itself from other global crypto hubs.
Overall, Hong Kong’s evolving regulatory environment is poised to attract substantial global capital, drive innovation in virtual assets, and provide greater investment opportunities for professional investors, all while maintaining high standards for security and compliance.