Hong Kong gives conditional licenses to four crypto exchanges

The Hong Kong Securities and Futures Commission has granted conditional licenses to four virtual asset trading platforms.

According to the SFC, the platforms of Accumulus GBA Technology, DFX Labs, Hong Kong Digital Asset EX and Thousand Whales Technology must meet certain regulatory conditions before becoming fully operational.

The licenses follow the SFC’s risk-based controls, which were introduced in June. These audits are designed to assess compliance with Hong Kong’s virtual asset regulations, which aim to protect investors while promoting growth in the crypto sector.

To proceed, licensed exchanges must complete third-party vulnerability assessments and penetration tests. These tests detect and fix potential security vulnerabilities, ensuring that platforms can trade digital assets safely.

The SFC will audit the process and evaluate whether the platforms have resolved the issues identified during the audits.

Hong Kong SFC approved four new cryptocurrency exchanges.

1) Accumulus GBA Technology
2) DFX Labs
3) Hong Kong Digital Asset EX
4) Thousand Whales Technology

This brings the total number of licensed virtual asset trading platforms in Hong Kong to 7. #Bitcoin… pic.twitter.com/akt9NzpMFP

— StellDex™ (@StellDex_HQ) December 18, 2024

SFC’s inspections and expectations

SFC’s Executive Director of Intermediaries, Dr. According to Eric Yip, the regulator worked closely with the management of these platforms to clarify expectations and expedite the licensing process.

This proactive engagement will continue until the second phase of evaluations, when external evaluators will evaluate the platforms under SFC supervision. If this stage is completed successfully and all conditions are met, exchanges will be able to expand their commercial activities.

SFC also published a circular outlining the roadmap for the licensing process. This guidance aims to ease the compliance journey for virtual asset trading platforms while strengthening regulatory standards.

For those unfamiliar with crypto regulation, licenses like this ensure that exchanges operate legally and securely. Licensed platforms must implement measures to protect user funds, prevent fraud and deter market manipulation.