Hong Kong’s Securities and Futures Commission (SFC) has granted in-principle approval to the Hong Kong Virtual Asset Exchange (HKVAX) to operate a virtual asset trading platform under the region’s securities laws.
The announcement, made on Aug. 11, stated that HKVAX has received approval-in-principle from the SFC to conduct Type 1 and Type 7 regulated activities. A Type 1 license will enable HKVAX to operate a digital asset trading platform dealing with securities, while a Type 7 license will officially permit the company to provide automated trading services to both retail users and institutional investors.
HKVAX plans to leverage Web3 investment opportunities by offering a product category known as security token offerings. Upon receiving final approval, the exchange intends to provide over-the-counter (OTC) brokerage services, allowing users to trade between fiat and digital assets. Additionally, HKVAX will offer an institutional-grade exchange platform and an insured custody solution.
Anthony Ng, co-founder and CEO of HKVAX, expressed the company’s ambition to continue expanding its product offerings in Hong Kong and to collaborate with strategic investors in upcoming funding rounds.
This development follows the recent debut of crypto retail trading in Hong Kong with exchanges HashKey and OSL. On Aug. 3, both firms became the first in the region to secure the necessary licenses to provide crypto trading services.
Hong Kong’s regulatory authorities have been increasingly focused on crypto regulation, particularly in the wake of the FTX exchange collapse in 2022. SFC CEO Julia Leung Fung-yee emphasized the importance of crypto trading within the virtual asset ecosystem and stated that the new licensing system for virtual asset service providers would ensure investor protection.
The in-principle approval for HKVAX marks another significant step in Hong Kong’s efforts to establish a regulated and secure environment for virtual asset trading, reflecting the region’s commitment to fostering innovation while maintaining investor safeguards.
