Hong Kong authorities are moving to bring virtual asset advisory and portfolio management services under formal licensing, extending the city's digital asset regulatory net beyond trading platforms, custody, and stablecoin issuers. The Financial Services and the Treasury Bureau (FSTB) and the Securities and Futures Commission (SFC) released consultation conclusions on Tuesday, July 22, setting the stage for a new chapter in Hong Kong's crypto oversight.
Advisory and management fall under Type 4 and Type 9 licenses
Under the proposed framework, firms offering virtual asset investment advice would be regulated under Type 4 regulated activity under the Securities and Futures Ordinance, while those managing virtual asset portfolios would fall under Type 9. This aligns crypto advisory and management services with rules applied to traditional financial institutions. The SFC stressed the principle of "same business, same risks, same rules," aiming for regulatory parity.
The consultation, launched on December 24, 2025, drew 51 submissions from market participants, industry bodies, chambers of commerce, and professional organizations. Authorities said the proposals received broad market support. Secretary for Financial Services and the Treasury Christopher Hui Ching-yu called the new rules part of Hong Kong's Policy Statement 2.0, focused on supporting responsible financial innovation while strengthening risk controls and investor protection.
Legislative timeline set for 2026, SFC urges early engagement
The government intends to submit the legislative proposals to the Legislative Council in 2026. SFC Chief Executive Julia Leung Fung-yee described the consultation conclusions as "the final step" in refining Hong Kong's digital asset regulatory framework, saying the regime would align with traditional financial service standards.
The SFC encouraged firms already offering virtual asset advisory or management services to contact the regulator early, and urged newcomers to begin pre-application talks. "Early discussions will help service providers understand the proposed licensing process and prepare for compliance before the new rules take effect," the regulator said. This proactive approach signals that authorities want to minimize friction between rule implementation and market practice.
Hong Kong already has licensing regimes for virtual asset trading platforms (since mid-2023) and stablecoin issuers (under the Stablecoin Ordinance passed in 2025). The addition of advisory and management services means the city now aims to cover the full value chain: issuance, trading, custody, advice, and portfolio management. Christopher Hui said the new rules, together with existing frameworks, would help cover the main parts of the digital asset market.
Current licensed crypto trading platforms in Hong Kong include OSL and HashKey. Stablecoin issuers must obtain a license under the new regime. Once the advisory and management licensing takes effect, firms engaged in such services would need separate Type 4 or Type 9 approvals.
Industry observers note that Hong Kong's "rules first" approach is creating a clear line between compliant and non-compliant operators. While some advisory firms operating in a gray area may face pressure, the clarity could attract institutional capital. However, smaller players worry about compliance costs. The SFC has indicated that licensing conditions will be proportional to business risk and take into account market capacity.