Hong Kong’s government is preparing new legislation to establish licensing regimes for four types of cryptocurrency activities. Officials plan to introduce the bill before the end of 2026, further strengthening the city’s regulatory framework for digital assets.
Planned licensing regimes for virtual assets
Christopher Hui, Secretary for Financial Services and the Treasury, presented the timeline during a briefing to the Legislative Council Finance Committee. Hui stated that the proposed regulations will cover virtual asset dealing, custody, advisory, and management services.
The bill must still pass through the Legislative Council before taking effect. If approved, the Securities and Futures Commission (SFC)—Hong Kong’s main securities regulatory authority—will oversee the licensing, supervision, and enforcement for the new regimes.
For firms engaged in virtual asset dealing, the regime will largely align with the city’s existing framework for Type 1 securities dealing. The SFC will also supervise custodians, with particular focus on safeguarding private keys and protecting digital assets held within Hong Kong.
Advisory and management services will be regulated using standards based on Type 4 (advisory) and Type 9 (asset management) requirements. Regulators stated their intention to apply a “same business, same risks, same rules” approach, aiming for consistency between traditional and digital financial activities.
Mini dictionary: Securities and Futures Commission (SFC), Hong Kong’s financial regulatory body overseeing securities and futures markets, including activities related to digital assets and virtual asset trading platforms.
Two public consultations shaped the new rules. The consultation for dealing and custody opened in June 2025 and received more than 190 responses. Advisory and management services were discussed in a separate consultation that closed in January 2026, with authorities confirming the results in May.
Existing frameworks and future supervision tools
Currently, Hong Kong already requires SFC authorization for crypto exchanges operating locally. In August 2025, SFC issued stricter requirements around custody, including mandates on the use of cold wallets, withdrawal processes, and cybersecurity standards for licensed platforms.
The Hong Kong Monetary Authority (HKMA) handles stablecoin regulation. The Stablecoins Ordinance came into effect in August 2025, and the first two issuer licenses were granted in April 2026. The HKMA intends to support central bank digital currency settlement and 24/7 operations by launching EnsembleTX near the end of 2026.
The SFC will introduce a digital asset custody surveillance system in the second half of 2026. In 2027, the agency’s CrypTech initiative is expected to add big-data market monitoring and anti-money laundering tools, further bolstering oversight abilities.
Under the government’s 2026 Policy Address, trading platforms licensed in Hong Kong are expected to support trading in regulated stablecoins. Regulatory expansion will also include tokenized investment products such as tokenized gold.
| Crypto Activity | Regulator/Framework | Expected Launch |
|---|---|---|
| Virtual asset dealing | SFC (Type 1 standards) | 2026 (pending law) |
| Custody | SFC | 2026 (pending law) |
| Advisory | SFC (Type 4 standards) | 2026 (pending law) |
| Management | SFC (Type 9 standards) | 2026 (pending law) |
| Stablecoin issuance | HKMA (Stablecoins Ordinance) | Launched 2025 |
Authorities have not specified when firms can start applying for the new licenses. Timelines, application procedures, and possible exemptions will be announced after the legislative process and further regulatory guidance. Licensed companies are also expected to follow forthcoming rules for tokenized assets as the market continues to evolve.
The SFC encourages industry participants to reach out for early discussions to better prepare licensing applications once the new regimes are enacted. Officials believe ongoing communication will help firms transition smoothly into the updated compliance landscape.
Officials emphasized that all new licensing standards for virtual asset dealing, custody, advisory, and management will be closely aligned with existing securities regulation to ensure consistent oversight across both digital and traditional markets.
