Hong Kong is reportedly considering giving the Securities and Futures Commission (SFC) a role in regulating over-the-counter (OTC) virtual asset trading services, the South China Morning Post reported.
This potential move would be a significant step in the region’s approach to regulating cryptocurrency markets.
Sources close to the talks reveal that the SFC is exploring a new licensing system for OTC cryptocurrency services. Under the proposed framework, the SFC will collaborate with the Hong Kong Customs and Excise Department (C&ED) to oversee companies engaged in such services. Previously, under a proposed regulation published in February 2024, oversight of OTC platforms was solely the responsibility of the C&ED.
Additionally, consultations were held with relevant firms regarding a new licensing regime for crypto custody services. Both licensing discussions are still in the early stages and the proposals are subject to further revisions.
Today, a spokesperson from the SFC said the organization is working closely with the Hong Kong government and other regulators to ensure the sustainable and responsible growth of the region’s virtual asset industry.
*This is not investment advice.
