Hong Kong regulator to treat custodial crypto exchanges like brokers

posted 13 days ago
Hong Kong’s securities watchdog plans to treat custodial cryptocurrency trading platforms like traditional brokers if they offer security tokens, according to regulatory guidance for the industry.

The Securities and Futures Commission (SFC) released its position paper on virtual asset exchanges, announcing a new licensing scheme that it said is not dissimilar from the one applied to Hong Kong’s security brokers and automated trading venues. Any virtual asset firm trading at least one security token falls under the regulator’s purview. Applications for peer-to-peer (P2P) exchanges – such as decentralized exchanges (DEX) or non-custodial trade platforms – will not be reviewed by the SFC.
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