Hong Kong Considers Allowing Tokenized Securities Trading for Retail Investors

Hong Kong's Securities and Futures Commission (SFC) is contemplating permitting licensed virtual asset trading platforms (VATPs) to offer secondary trading services for tokenized securities to retail clients. According to ChainCatcher, Lo Hoi-sze, Deputy Director of the SFC's Intermediaries Division, stated that the authorities are examining the relevant requirements, operational risks, and control measures, and are drafting related circulars. Currently, retail investors in Hong Kong can only subscribe to and redeem tokenized funds in the primary market. Lo highlighted the SFC's interest in the local tokenized money market funds and expressed a desire to enable their trading on licensed VATP platforms. The SFC has initiated preliminary consultations with the industry regarding these requirements. Lo emphasized that from the SFC's perspective, tokenized securities are fundamentally the same as ordinary securities, with the addition of a technological aspect. Therefore, the regulatory principle of "same business, same risk, same rules" will be applied.