- Plans 2026 law for licensing virtual asset dealers and custodians
- Regime sits under AML and CTF rules similar to securities
- New consultation adds oversight for virtual asset advisers and managers
On December 24, 2025, Hong Kong regulators released consultation conclusions that move virtual asset dealing and custody towards a full licensing regime. After a two-month public consultation that drew more than 190 written responses, the Financial Services and the Treasury Bureau and the Securities and Futures Commission confirmed plans to bring a new bill to the Legislative Council in 2026. The future rules will sit inside the Anti-Money Laundering and Counter-Terrorist Financing Ordinance and will mirror many expectations already familiar to securities intermediaries. At the same time, the authorities launched an extra consultation on virtual asset advisory and management activities, so the entire lifecycle of digital asset services can move under a clear and consistent framework.
Hong Kong regulators set a 2026 timeline for virtual asset legislation
The joint consultation on virtual asset dealing services began on June 27, 2025 and ran for two months, closing on August 29. Authorities received 101 submissions on the proposed regime for dealing services and 93 submissions on the regime for custodian services, which together account for the “more than 190 responses” highlighted in public statements. Respondents included trading platforms, over-the-counter shops, industry associations, professional bodies and individual market participants. Feedback generally supported extending regulation beyond licensed trading platforms to cover dealers and custodians, describing this move as the natural next step after the virtual asset trading platform licensing regime that has been in place since June 2023. Under the plan, the new licensing regimes will be written into the Anti-Money Laundering and Counter-Terrorist Financing Ordinance rather than the Securities and Futures Ordinance. Any person who carries on a business of virtual asset dealing in Hong Kong, or markets such services actively to the Hong Kong public from overseas, will require a licence, with similar expectations to Type 1 intermediaries that deal in securities. The authorities also propose a prohibition on unlicensed firms actively marketing virtual asset dealing services to Hong Kong investors, again following an approach long used in traditional securities markets. Consultation conclusions summarise comments on scope, regulatory requirements, transitional periods, licensing fees, powers for regulators and appeal mechanisms. Market participants asked for clarity on the definition of “actively market,” on omnibus account structures and on coordination between the Securities and Futures Commission and the Hong Kong Monetary Authority. Hong Kong regulators now intend to finalise drafting work and aim to introduce the bill that establishes these licensing regimes to the Legislative Council in 2026.
Licensing regimes for dealers and custodians under Hong Kong regulators
The future regime for virtual asset dealing services reaches beyond pure over-the-counter cash trading. Earlier consultation papers and law-firm summaries show that it will capture activities such as virtual asset–to–virtual asset conversion, subscription and underwriting of new tokens, and some omnibus account arrangements, bringing a wide range of intermediaries into one framework. Dealers will need to be locally incorporated or registered as non-Hong Kong companies, meet minimum capital and liquid capital thresholds and demonstrate that responsible officers and controllers pass fit-and-proper tests. Proposals benchmark some fees and financial resources to existing Type 1 regimes so that firms familiar with securities licences can read across to the new standards. For custodians, the core risk lies in controlling private keys. The dedicated custodian licensing regime therefore concentrates on key-management architecture, segregation of client assets, wallet configurations and operational resilience. Licensed custodians will need clear policies for the mix between hot and cold storage, controls over staff access, incident reporting and arrangements for insurance or other forms of protection where appropriate. Some entities fall outside the full licence, such as technical service providers that never hold private keys and bank security vaults that only store encrypted backups, while banks, stored-value facility licensees and licensed stablecoin issuers may rely on existing oversight where custody is incidental to their main regulated business. Transitional arrangements feature in the consultation conclusions. Existing regulated firms that already hold relevant licences under the Securities and Futures Ordinance may benefit from expedited processing when they apply for the new virtual asset licences. Unlicensed businesses that currently operate over-the-counter shops or custody services will receive a limited window to apply, after which they must either obtain a licence or exit the Hong Kong market. In this way, Hong Kong regulators tie virtual asset dealing and custody to the same anti-money-laundering standards that apply elsewhere in the financial system, while providing a pathway for current operators to regularise their position.
ASPIRe roadmap, ETFs and staking connect the new rules to Hong Kong regulators wider agenda
The new licensing proposals do not stand alone; they sit inside a broader roadmap that Hong Kong regulators describe as the ASPIRe framework, short for Access, Safeguards, Products, Infrastructure and Relationships. Since 2018, the Securities and Futures Commission has gradually added layers to the regime, first by issuing guidance to portfolio managers, then by introducing the trading-platform licensing rules that took effect in June 2023 for centralised virtual asset trading platforms. In February 2025, the Securities and Futures Commission signalled the next stage by announcing new licensing regimes for over-the-counter trading and custody, and by starting a review of derivatives and margin trading in virtual assets. That statement prepared the ground for the June 2025 joint consultations on dealers and custodians and set expectations that the authorities would move beyond exchange-centric supervision. Another milestone arrived in April 2025, when guidance allowed licensed trading platforms and certain funds to provide staking services under strict conditions. Platforms must keep full control of staked assets, maintain detailed risk disclosures and obtain regulatory approval before launching such services. By that point, spot virtual asset exchange-traded funds had already been trading in Hong Kong since April 30, 2024, when Asia’s first spot Bitcoin and Ether ETFs listed on the Hong Kong stock exchange. Those products sit in a regulated structure that relies on licensed custodians and trading venues, so extending full licensing to dealers and custodians helps align the infrastructure behind these funds with a dedicated statutory regime. Recent guidance under the ASPIRe roadmap also permits licensed virtual asset trading platforms in Hong Kong to access global order books under set safeguards, so liquidity from foreign markets can interact with Hong Kong’s regulated environment. The introduction of dealer and custodian regimes will complement that access by ensuring that intermediaries which stand between end-clients, platforms and funds operate under clear and consistent obligations. In this way, Hong Kong regulators try to place virtual asset activity on a footing that resembles the wider securities market, while keeping paths open for cross-border capital flows.
Expanding oversight to advisers and managers under “same business, same risks, same rules”
Feedback during the consultations indicated that licensing dealers and custodians alone would not capture the entire value chain. Advisory firms and asset managers that specialise in virtual assets also play a central role in how retail and institutional investors enter the market. Responding to these comments, the Financial Services and the Treasury Bureau and the Securities and Futures Commission have proposed two further licensing regimes: one for virtual asset advisory service providers and another for virtual asset management service providers. These regimes will borrow structure from existing Type 4 (advising on securities) and Type 9 (asset management) activities under the Securities and Futures Ordinance. Advisory firms giving investment recommendations on virtual assets and managers running dedicated virtual asset portfolios would need to meet standards comparable to those already applied in the securities sector, including requirements on suitability, disclosure, governance and oversight of any custody arrangements that they direct. The further consultation on these proposals opened on December 24, 2025, with comments due by January 23, 2026. Authorities invite submissions by post or email, and signal that they may publish names and submissions in summary form, consistent with earlier practice. As with the regimes for dealers and custodians, the guiding principle is “same business, same risks, same rules,” so that functionally similar activities face similar obligations, regardless of whether they involve securities or virtual assets. When this process concludes, Hong Kong regulators will oversee trading platforms, dealers, custodians, advisers and managers within one connected statutory architecture.
Conclusion
The current round of consultation conclusions and fresh proposals shows how far Hong Kong has moved from ad-hoc guidance towards a full statutory structure for virtual assets. Licensing regimes for dealers and custodians under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, together with planned regimes for advisers and managers, will bring most intermediaries that touch client digital assets inside one framework. With a target of introducing the bill to the Legislative Council in 2026, firms now have a clear view of the direction of travel and can begin preparing for authorisation, capital planning, systems changes and governance upgrades. As these regimes take effect, Hong Kong regulators intend to align virtual asset business with established expectations from the securities world, while keeping the city open as a venue for regulated digital asset activity in the region.
Disclaimer
The information provided in this article is for informational purposes only and should not be considered financial advice. The article does not offer sufficient information to make investment decisions, nor does it constitute an offer, recommendation, or solicitation to buy or sell any financial instrument. The content is opinion of the author and does not reflect any view or suggestion or any kind of advise from CryptoNewsBytes.com. The author declares he does not hold any of the above mentioned tokens or received any incentive from any company.
Featured image create by AI
