On October 20, the Hong Kong Securities and Futures Commission (SFC) released new guidelines, replacing the January 2022 directive regarding digital asset activities.
This move followed an uptick in queries from intermediaries about distributing such assets, which the SFC and the HKMA noted.
Tracing back to 2018, the SFC set up regulations for digital assets, including a rule that primarily allowed the distribution of digital asset funds to “professional investors.”
However, a more diverse range of investment opportunities, catering to both retail and professional sectors, has since emerged. Hence, the SFC now allows its licensed digital asset platforms to cater to the general public. This also includes greenlighting public virtual asset futures ETFs in Hong Kong.
In light of recent market trends and questions, both the SFC and the HKMA revised policies to increase retail access via intermediaries. This will enable investors to more directly handle digital assets. The new norms label digital assets as “complex products”, aligning them with similar financial assets in terms of guidelines.
It’s worth noting, however, that the 2018 risks linked with digital asset investments remain intact.
Adding to the discussion, on October 11, just a week prior, Wang Yang, the Vice-President of The Hong Kong University of Science and Technology, expressed his concerns about Hong Kong’s digital asset regulations. He emphasized its challenging nature, coining the term “Licensed to Be Killed.” Nonetheless, Hong Kong persists in its journey to become a leading cryptocurrency hub.