Overview
- The Financial Services and the Treasury Bureau and the Securities and Futures Commission published consultation conclusions Tuesday that propose formal licensing for firms giving virtual‑asset advice and managing crypto portfolios.
- The proposals map virtual‑asset advisory to Type 4 regulated activity and virtual‑asset management to Type 9 under the Securities and Futures Ordinance so they follow the same rules as comparable securities services.
- Regulators set clear, tiered capital tests with a minimum paid‑up capital of HK$5 million, liquid capital of HK$3 million for firms that hold client assets, and HK$100,000 for firms that do not hold client assets.
- Both regimes would sit under the Anti‑Money‑Laundering and Counter‑Terrorist Financing Ordinance, regulators plan to finalise the draft law for submission to the Legislative Council in 2026, and the SFC is urging firms to start pre‑application discussions now.
- The move builds on December 2025 rules for dealing and custody and is meant to close a regulatory gap, improve investor protections, and invite more institutional participation while raising compliance and supervisory demands for providers and the SFC.