Hong Kong Regulators to Issue New Licenses for Crypto Trading Platforms
Hong Kong regulators have announced plans to issue new licenses for crypto trading platforms in the country after an extensive review process. This move comes as the global crypto industry continues to evolve and gain recognition.
New Virtual Asset Licenses on the Horizon
According to a report by Chinese media outlet SINA Finance, Ye Zhiheng, Executive Director of the Intermediary Department of the Hong Kong Securities and Futures Commission, revealed that new virtual asset licenses will soon be issued. While no specific date has been provided, Ye hinted at the possibility of “good news” in the first quarter of 2025.
Ye, who also chairs the country’s Fintech Advisory Group, highlighted the rigorous review process that all applicants underwent last year. The SFC conducted onsite inspections and directly communicated the necessary requirements to potential license holders. Crypto platforms were given adequate time to address any concerns raised by the SFC.
Regulatory Red Lines and Investor Protection
Despite the positive outlook, Ye cautioned that not all 11 platforms under review may be granted licenses. He emphasized the importance of adhering to regulatory standards, particularly in terms of investor protection and security requirements. These “regulatory red lines” serve as guidelines for platforms seeking licensure.
Ye expressed optimism that the SFC will be able to share positive developments in the coming months, signaling progress in the licensing process.
Recognition from the People’s Bank of China
In December, the People’s Bank of China commended Hong Kong regulators for their proactive stance on issuing more licenses for crypto trading platforms. The central bank acknowledged the growing importance of the crypto industry globally and the need for regulatory frameworks to support its development.
However, Hong Kong still lags behind countries like Singapore, which have issued a higher number of crypto licenses in 2024. Regulatory challenges have contributed to delays in the licensing process, with initial estimates pushed back to early 2025.
Categorization of Cryptocurrency
In Hong Kong, cryptocurrency is categorized into security tokens and non-security tokens for regulatory purposes. Security tokens fall under the licensing standards of the SFC, while non-security tokens must comply with anti-money laundering regulations.
As the crypto industry continues to evolve, Hong Kong is working towards enhancing its regulatory framework to support the growth of digital assets and ensure investor protection.