Hong Kong will put its next set of crypto licensing rules before lawmakers before the end of 2026. Briefing the Legislative Council's Panel on Financial Affairs on 5 October 2026, Secretary for Financial Services and the Treasury Christopher Hui said the government will submit an amendment bill this year to establish licensing for virtual asset dealing, custody, advisory, and management services.
The paper the Financial Services and the Treasury Bureau (FSTB) tabled for that meeting sets out the same plan. In paragraph 29, it states that the government and the Securities and Futures Commission (SFC) will enhance the existing virtual asset licensing regimes, issue detailed regulatory guidance, and introduce the bill to provide virtual asset service providers with a clear route to compliance.
From a policy blueprint to a bill
The commitment is included in Hong Kong's First Five-Year Plan for 2026 to 2030, which the Chief Executive announced alongside the 2026 Policy Address on 16 September. The plan says Hong Kong will build a world-leading licensing and regulatory regime for digital assets, guided by the principle that the same activity carrying the same risks should be subject to the same regulation.
The bill is not new; it was set as a 2026 task in the 2025 Policy Address, and the progress table in the 2026 Policy Address supplement marks it as "on track". Drafting is underway, and the government now expects to introduce legislation covering all four types of service in the fourth quarter of 2026.
Four new licences, modelled on securities rules
Hong Kong already licenses virtual asset trading platforms, a regime in place since June 2023, and stablecoin issuers, which are supervised by the Hong Kong Monetary Authority (HKMA). The new bill extends the framework to the firms that sit around those platforms. Its content was settled through two rounds of consultation run jointly by the FSTB and the SFC.
Dealing and custody. The conclusions published on 24 December 2025 confirmed both regimes after 101 submissions on dealing and 93 on custody. Virtual asset dealers will be regulated much like firms licensed for Type 1 (dealing in securities) under the Securities and Futures Ordinance (Cap. 571). Custody rules will concentrate on the safekeeping of private keys for client assets in Hong Kong, which the government identifies as the core risk in that business.
Advisory and management. Respondents in the first round asked for advice and asset management to be separated from the dealing regime. The government agreed, consulted again, and published its conclusions on 26 May 2026, following 51 submissions. Virtual asset advisers will mirror Type 4 (advising on securities) and managers will mirror Type 9 (asset management) under the same ordinance.
"The conclusion of further consultation marks the final leg of our journey to complete the regulatory framework for digital assets, paving the way for the long-term scaling of our ecosystem."
Julia Leung, Chief Executive Officer, Securities and Futures Commission
What licensed firms will need
The consultation conclusions also fix baseline financial resources, aligned with the equivalent securities licences:
- Dealers: minimum paid-up share capital of HK$5 million and liquid capital of up to HK$3 million, depending on the business model.
- Custodians: minimum paid-up share capital of HK$10 million and liquid capital of HK$3 million, with banks already under HKMA capital rules carved out.
- Advisers and managers: liquid capital of HK$100,000 for firms that do not hold client assets, or HK$5 million paid-up share capital plus HK$3 million liquid capital for those that do.
Firms already regulated elsewhere will be exempt. Stablecoin issuers licensed by the HKMA, for example, will not need a dealing licence for their regulated stablecoin activity. SFC-licensed trading platforms, as well as licensed corporations and registered institutions already offering virtual asset dealing, will undergo an expedited approval process.
No grace period for existing operators
The most pressing detail for firms already active in Hong Kong is the transition. The government has ruled out a deeming arrangement for existing dealing and custody providers, on the basis that it could blur their regulatory status and weaken investor protection. Both regimes will take full effect on the day the statutory provisions come into force. Firms that have not engaged early may find themselves forced to stop operating on that date.
Respondents were split on this. Half of those commenting on custody supported a hard start, while the other half requested a transition period of 3 to 18 months. In response, the government and the SFC have said they will set the commencement date with the time firms need to adjust in mind. Europe's experience shows why the date matters: when MiCA's transitional window closed, many crypto firms were left without authorisation.
"Together with the existing licensing regimes for VA trading platforms and stablecoin issuers, as well as the proposed regimes for VA dealing and custodian service providers, our legal framework will span across the key nodes of the digital asset ecosystem, building a trusted and sustainable system comparable to that of conventional finance, thereby leading us towards the vision set out in the Policy Statement 2.0."
Christopher Hui, Secretary for Financial Services and the Treasury
What compliance teams should do now
For brokers, custodians, fund managers and advisers dealing in virtual assets in or into Hong Kong, the message from the conclusions is to start the conversation with the regulator before the bill passes, not after. In practice that means:
- contacting the SFC, or the HKMA for banks, to begin pre-application;
- mapping each business line to the right new licence, since one firm may need several;
- testing capital positions against the baseline figures above;
- for custodians, documenting exactly who can access, generate, store or recover private keys, as the conclusions single out those individuals.
The bill is part of a broader digital asset agenda in the same LegCo paper, which also covers tokenised real-world assets and the wider use of licensed stablecoins. Anchorpoint's Hong Kong dollar stablecoin HKDAP went live through licensed distributors in August, and the city recently settled a record HK$20 billion digital green bond in tokenised deposits. The next milestone is the bill's first reading at LegCo, expected before the year is out.
