The Hong Kong Securities and Futures Commission plans to approve a number of new crypto licenses by the end of this year. There are 11 crypto platforms being considered for licensing so far.
Liang Fengyi, CEO of the China Securities Regulatory Commission, announced in an interview with Hong Kong 01 news outlet that the SFC will issue bulk licenses to Virtual Asset Trading Platforms.
The SFC recently issued three licenses for crypto exchanges operating in the region, including the Hong Kong Virtual Assets Exchange, OSL Exchange and HashKey Exchanges.
In addition to the three licensed platforms, 11 more platforms have applied for licenses issued by the SFC and are currently awaiting approval.
Liang Fengyi explained that regulators have carried out the first stage of on-site inspections and asked applicants to make the necessary corrections.
He noted that the SFC aims to make significant progress in regulating virtual assets by the end of the year by issuing a number of licenses for VATPs.
“Candidates who do not meet the requirements will lose their licensing qualifications, while candidates who meet the requirements will be conditionally licensed,” Fengyi said.
Liang Fengyi said that as part of their 2024-2026 strategy, Hong Kong regulators will promote the development of regulations for virtual asset trading platforms, support the tokenization of traditional products, and use regional chains and web3 core technologies.
“The entire framework will be completed at least next year,” he said.
Regarding cryptocurrency over-the-counter services, Liang Fengyi pointed out that the CSRC has established a new licensing system for crypto OTC custody services in order to receive feedback from industry players.
In mid-September 2024, the Hong Kong Securities and Futures Commission began working with the Customs and Excise Department to issue licenses for over-the-counter crypto trading services. At the time, crypto platforms in Hong Kong were struggling to obtain licenses because they did not meet government standards on customer asset management and failed to accurately anticipate cybersecurity risks.
On September 30, ZA Bank became the first virtual asset bank in Hong Kong to receive a license from the SFC, following a year-long review process.
Licenses are vital for crypto platforms operating in Hong Kong, as financial regulators tighten restrictions on unlicensed exchanges and the development of a regulated crypto ecosystem.