The Hong Kong Securities and Futures Commission Releases Virtual Assets Roadmap, Market May Face New Changes

On February 19, 2025, the Hong Kong Securities and Futures Commission officially released the "Virtual Asset Roadmap" aimed at addressing various challenges in the development of the virtual asset trading market in Hong Kong.

The roadmap known as "A-S-P-I-Re" proposes 12 key measures from five aspects: connectivity, security, products, infrastructure, and relationships, clarifying Hong Kong's development and regulatory direction in the virtual asset field for the coming years.

As one of the global financial centers, Hong Kong began exploring the regulatory framework for virtual assets as early as 2018. In 2023, the Securities and Futures Commission included virtual asset trading within the regulatory scope, requiring trading platforms to obtain licenses and introduce investor protection measures. In April 2024, Asia's first virtual asset spot exchange-traded funds were listed on the Hong Kong Stock Exchange, highlighting Hong Kong's leading position in virtual asset innovation and regulation.

However, the virtual asset market in Hong Kong still faces some challenges:

1. Limited market activity: Despite the surge in the global virtual asset market value in 2024, the Hong Kong market remains relatively small. As of December 2024, the total trading volume of cryptocurrency spot ETFs in Hong Kong reached a historical high of $58 million, but it still falls short compared to the global market.

2. Market access restrictions: Mainland investors cannot participate in the Hong Kong market in compliance, while users from other regions tend to trade on local or global mainstream exchanges, resulting in a disconnection between the Hong Kong market and other international financial centers.

3. Limited product categories: Virtual asset trading in Hong Kong is mainly concentrated on mainstream cryptocurrencies such as Bitcoin and Ethereum, with other cryptocurrencies having relatively low trading volumes. Licensed institutions have limited development in derivative innovation.

To address these challenges, the "A-S-P-I-Re" roadmap proposes five pillars and 12 initiatives:

1. Access: Simplify market access and provide a clear regulatory framework. Consider establishing a licensing system for OTC trading and asset custody services, allowing for a two-tier market structure where trading and custody are separated.

2. Safeguards: Strengthen compliance and risk control. Study the regulatory framework for new token listings and virtual asset derivatives trading aimed at professional investors, clarify investor access requirements and product classification, and adjust the ratio requirements for hot and cold wallets.

3. Products: Expand product categories and investment tools. Explore new coin listings exclusive to professional investors and virtual asset derivatives trading, and consider offering staking and lending services.

4. Infrastructure: Upgrade regulatory infrastructure. Deploy a data-driven blockchain monitoring platform to promote cross-border cooperation with global regulatory agencies.

5. Relationships: Promote communication and education for investors. Build a collaborative mechanism with financial influencers to establish a sustainable industry communication and talent development network.

Professionals believe that if this roadmap can be successfully implemented, Hong Kong is expected to create a more active market, with more diverse investment strategies and a more transparent and secure regulatory environment for virtual asset investment in the coming years. Hong Kong is likely to occupy an important position in the global layout of virtual assets, leading industry innovation and development.

It is worth noting that the roadmap emphasizes the importance of investor education. While many people in Hong Kong understand the concepts of virtual assets and cryptocurrencies, relatively few truly understand them in depth and actively participate. Only by enhancing investors' knowledge systems and risk identification capabilities can Hong Kong's virtual asset development blueprint truly flourish.

The release of this roadmap marks an important step for Hong Kong in the field of virtual assets. By balancing regulation and innovation, Hong Kong is expected to find new breakthroughs in the global virtual asset competition, further consolidating its position as an international financial center.