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📊 Hong Kong Updates Virtual Asset Guidelines and Regulatory Framework
Hong Kong is taking a major step forward in the development of its virtual asset (VA) sector with new guidelines and regulatory plans designed to expand services while maintaining strong investor protections.
1️⃣ Expanded VA Trading & Services
The Securities and Futures Commission (SFC) has introduced updated rules allowing licensed brokers to offer virtual asset margin financing to qualified clients under strict safeguards. This enables clients to use securities margin accounts for certain VA positions, with risk controls such as collateral requirements and transparency standards.
Additionally, the framework now supports leveraged VA products — including perpetual contracts — for professional investors, widening the scope of what licensed virtual asset trading platforms (VATPs) can offer while maintaining investor protections.
2️⃣ Broader Regulatory Overhaul
Hong Kong regulators plan to formalize a comprehensive VA licensing regime beyond the current VATP model. This will cover virtual asset dealing, custody, advisory, and asset management services. Once enacted, service providers in these categories will need explicit licenses to operate in Hong Kong. Draft legislation for this next phase is expected to be introduced in 2026.
This activity-based regulatory approach aims to create a holistic framework aligned with global standards, moving beyond piecemeal rules and strengthening market integrity.
3️⃣ Part of a Strategic Roadmap
These initiatives are part of the SFC’s “A-S-P-I-Re” roadmap, a five-pillar strategy to:
Enhance investor protection
Broaden market access
Support infrastructure and product development
Hong Kong has already made significant strides under this roadmap, including pioneering regulated VA spot ETFs in Asia, expanding product offerings on licensed platforms, and facilitating integration with global liquidity pools under proper safeguards.
4️⃣ Complementary Stability Rules
Alongside VA guidelines, Hong Kong enacted the Stablecoin Ordinance in 2025, which regulates stablecoin issuers through licensing and reserve requirements. This forms an integral part of the broader digital asset regulatory ecosystem, ensuring stability and compliance.
🧠 Market Implications
Greater service diversity: Licensed platforms and brokers can now provide more services, potentially boosting liquidity and encouraging institutional participation.
Comprehensive licensing: Future legislation will cover a wider range of VA activities, strengthening Hong Kong’s position as a globally regulated digital asset hub.
Investor protections remain central: Safeguards around eligibility, risk controls, custody standards, and licensing thresholds remain key pillars of these new guidelines.
Hong Kong’s approach signals its ambition to be a leading, regulated center for virtual assets, balancing innovation with robust investor protection.