Hong Kong's Financial Secretary, Paul Chan Mo-po, recently released an article titled "The Development of Innovation and Technology in Hong Kong," outlining the government's commitment to transform Hong Kong into an international hub for virtual assets. Chan emphasized that this policy declaration aims to express the government's stance globally, showcasing its vision to propel Hong Kong into a leading international center for virtual assets. The commitment includes a shared exploration of financial innovation with the global asset industry.

[Image source: Paul Chan Mo-po's official public media]

For aspiring entrepreneurs gearing up for ventures in Hong Kong, here's a crucial heads-up: engaging in virtual asset management activities requires obtaining the Asset Management License under the HKSFC regulations. Additionally, compliance with the "Proforma Terms and Conditions for Licensed Corporations which Manage Portfolios that Invest in Virtual Assets," issued by the Securities and Futures Commission on October 4, 2019, is essential. Detailed terms can be downloadedhere.

Earlier this year,Joseph Chan Ho-lim Deputy Secretary for Financial Services and the Treasury, pointed out that security token offerings (STOs) have been issued in Hong Kong. In a recent meeting, it was revealed that over ten potential STO issuers expressed keen interest, underlining the government's commitment to supporting the robust development of fintech, including security token offerings, in Hong Kong. Chan emphasized that the Hong Kong Special Administrative Region government is dedicated to fostering the growth of fintech to provide innovative financial services supporting the development of the real economy. The government supports the sustainable development of STO business in Hong Kong, provided it complies with relevant regulatory and compliance requirements to ensure investor protection and address concerns related to anti-money laundering and counter-terrorism financing.

Simultaneously, Elizabeth Wong, Director of Licensing and Head of the Fintech Unit at the Securities and Futures Commission (SFC) in Hong Kong, stated during an internal discussion at InvestHK that they are considering allowing retail investors to "participate in virtual asset investment" and are preparing to solicit public opinions on this matter.

Based on ourobservation, there are currently up to 10 licensed virtual asset management companies in Hong Kong that can manage 100% of virtual assets. This indicates significant room for growth in Hong Kong's virtual asset management industry.

For further insights and potential solutions in navigating these developments, feel free to reach out to our teamfor further discussion.