
Hong Kong aims to become a leading hub for virtual asset trading by implementing a robust regulatory framework for cryptocurrency platform operators. Companies intending to provide virtual asset trading services must obtain the relevant licenses from the Hong Kong Securities and Futures Commission (SFC) under the Securities and Futures Ordinance (SFO) and the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO).
Legal Basis for Licensing
Hong Kong operates a dual licensing regime for cryptocurrency platform operators:
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SFO Regime – Applies to centralized trading platforms dealing in tokens classified as securities. This regime requires licensing for the following types of regulated activities:
-Type 1: Dealing in securities
-Type 7: Providing automated trading services
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AMLO Regime – Applies to centralized trading platforms dealing in tokens not classified as securities. This regime requires a license for the provision of virtual asset services, including custody and management.
Since the classification of virtual assets may evolve (e.g., tokens may shift from non-securities to securities), it is advisable to apply for licenses under both regimes (SFO and AMLO) to avoid regulatory compliance issues.
Key documents required for obtaining a license
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Company’s constitutional documents.
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Detailed description of the corporate structure and governance system.
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Risk management and internal control policies and procedures.
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Compliance plans and client protection measures.
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Resumes detailing the experience and qualifications of key personnel.
Requirements for a Crypto License in Hong Kong
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Financial soundness or solvency.
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Education, qualifications, and experience of key personnel.
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Ability to conduct regulated activities competently, honestly, and fairly.
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Reputation and financial integrity of the company’s management.
Stages of obtaining a license
1. Application Preparation and Submission
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Completion and submission of the application form through WINGS, the SFC’s electronic portal
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Provision of all necessary documents confirming the applicant’s compliance with legal requirements
2. Application Review
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The SFC evaluates submitted materials to verify compliance with applicable laws and regulations
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Additional information or clarification may be requested, if needed
3. Decision Making
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Upon completion of the review, the SFC issues a decision to grant or deny the license
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If approved, the license is issued along with specified conditions and obligations
Licensing fees and costs
The costs associated with obtaining a license include:
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Registration fees: Payment for application processing and license issuance
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Operational expenses: Costs related to implementing and maintaining compliance systems, including hiring qualified staff and deploying transaction monitoring technologies
Obtaining a crypto license in Hong Kong requires thorough preparation and ongoing compliance with strict regulatory standards. Companies seeking to operate in this sector must be prepared to invest in the development of robust compliance systems, ensuring transparency and building trust with both clients and regulators.
The legal team at Law&Trust is ready to assist you throughout the entire licensing process.
F.A.Q.
Who issues the crypto license in Hong Kong?
The license is issued by the Securities and Futures Commission (SFC) - the primary financial regulator in Hong Kong.
How long does it take to obtain a crypto license?
The process typically takes 6 to 12 months, depending on the completeness of documentation, company structure, and the regulator’s processing speed.
Can clients from other countries be served?
Yes, licensed entities can serve both local and international clients, provided they comply with the relevant laws of other jurisdictions.