Following the approval of cryptocurrency exchanges by Hong Kong regulators less than a year ago, there has been a notable surge in interest from traditional financial institutions and brokerages seeking digital asset trading licenses.
In January, Chinese stockbroker Tiger Brokers expanded its Securities and Futures Commission (SFC) Category 1 securities license to include cryptocurrency trading for professional investors and financial institutions in Hong Kong. John Fei Zeng, the CFO and director of Tiger Brokers, highlighted the company's growing clientele, which boasts 865,500 funding accounts with total assets under management amounting to $18.9 billion.
Tiger Brokers (Hong Kong) has upgraded its license to trade virtual assets for professional investor clients through an SFC-licensed virtual asset platform. The company plans to extend its services to retail customers pending approval from the Securities and Futures Commission, enabling Hong Kong residents to trade virtual assets like Bitcoin and Ethereum alongside stocks, options, futures, funds, and ETFs.
In addition to Tiger Brokers, Victory Securities obtained a license from the Securities and Futures Commission in November to offer cryptocurrency trading services to retail investors. The company reported a significant increase in virtual asset transactions and new customer acquisition in the third quarter of the year, aiming to incentivize customers with transaction discounts to choose compliant and secure virtual asset trading services.
Meanwhile, Hong Kong-licensed cryptocurrency exchange OSL forged a partnership with Interactive Brokers in November 2023, facilitating Bitcoin and Ethereum transactions for retail investors through its platform. Similarly, Bybit, a cryptocurrency exchange, submitted an application for a retail trading license in Hong Kong on February 1, reflecting the growing interest in expanding digital asset trading offerings within the region.
The process of obtaining a trading license in Hong Kong for Web3 companies entails substantial investment, with estimates suggesting expenditures of up to $25 million on enterprise infrastructure and compliance measures to meet regulatory requirements.
