Hong Kong Updates Regulations on Virtual Asset Activities

According to PANews, the Hong Kong Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) jointly issued a supplementary circular on September 30, updating the licensing and registration conditions for intermediaries involved in virtual asset activities. The updates reflect market developments and industry feedback, with plans to issue guidelines on activities involving designated stablecoins. The circular outlines several key changes. Firstly, intermediaries are now permitted to offer staking services to their clients, which must be conducted through licensed platforms using independent accounts, with risk disclosures provided. Secondly, licensed corporations and registered institutions can offer off-platform trading services through licensed platforms. Additionally, the circular clarifies that clients using virtual assets to subscribe to or redeem investment products, or using physical assets to subscribe to or redeem virtual asset funds, will not be considered as providing virtual asset trading services. Intermediaries are required to notify clients in advance, hold virtual assets in compliance, and adhere to anti-money laundering regulations. Furthermore, the circular specifies that intermediaries must ensure clients have sufficient net assets and make risk disclosure statements regarding virtual asset futures contracts. These requirements do not apply to institutional professional investors and qualified corporate professional investors.