The Securities and Futures Commission (SFC) of Hong Kong has stated that it intends to allow regulated platforms to serve ordinary investors. The SFC has announced that owners of virtual asset trading platforms who are ready to follow its suggested rules can apply for a license.
Future regulations for virtual asset trading platforms will include a range of topics, including asset custody security requirements, cybersecurity best practices, and client asset segregation. These steps are intended to guarantee the safety and protection of the assets of retail investors.
Promoting Growth and Investor Protection
To encourage a responsible and creative development environment, SFC CEO Julia Leung underlined the value of clearly defining regulatory requirements. Hong Kong’s decision to permit licensed platforms for retail investors demonstrates its dedication to fostering the expansion of the virtual asset sector while defending investors’ interests.
The SFC’s decision to allow licensed platforms to service retail investors represents a significant advancement in Hong Kong’s regulation of trading in virtual assets. This action is intended to increase investor trust and support the regional virtual asset ecosystem’s continued growth.
A “number of robust measures” would also be put in place, according to the SFC, to ensure that retail investors are protected. These include transparency, enhanced token due diligence, enhanced token due diligence, excellent governance, and suitability during the onboarding process.