Hong Kong Issues First Crypto Trading Licenses of 2025

The Securities and Futures Commission (SFC) of Hong Kong has issued the first crypto trading licenses of 2025. The regulator granted two new licenses, bringing the total to seven since mid-2024.

The Securities and Futures Commission (SFC) of Hong Kong has granted two new licenses to cryptocurrency exchanges, bringing the total to seven since mid-2024.

The regulator announced on Jan. 27 that it has issued operational licenses to PantherTrade and YAX, both of which are Hong Kong-based crypto exchanges. According to public records, both entities have been registered under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO), which permits them to operate within the city’s regulated digital asset market.

Only 10 Crypto Exchanges Approved in Hong Kong Since 2020

Hong Kong has been gradually expanding its regulatory framework for crypto exchanges. Since 2020, 10 virtual asset trading platforms (VATPs) have received licenses under AMLO. However, the licensing process has been slow, with the SFC initially aiming to approve 11 platforms by the end of 2024.

The regulator has conducted on-site inspections to evaluate compliance with customer protection measures, Know Your Customer (KYC) procedures, and cybersecurity standards.

Hong Kong's Strict Regulatory Approach to Digital Assets

Over the years, Hong Kong's approach to cryptocurrency regulation has shifted. Initially, the city lacked a specific legal framework for digital assets. Subsequently, the Securities and Futures Commission (SFC) classified some crypto assets as securities under the Securities and Futures Ordinance (SFO), subjecting certain tokens and initial coin offerings (ICOs) to regulatory approval.

In June 2023, a new licensing requirement was introduced, mandating that all VATPs operating in Hong Kong must obtain an SFC license. This measure aligns with the city's broader efforts to ensure market stability and investor protection.

Following a wave of licenses granted in December 2024 under an expedited licensing process, the latest approvals come as part of the SFC's ongoing efforts to regulate the crypto sector in Hong Kong. At the time, the SFC approved four additional VATPs, including:

These platforms received conditional licenses and must address compliance issues before offering full services. The SFC requires them to undergo vulnerability assessments and penetration testing conducted by an independent third party to ensure adherence to security standards.

Crypto Trading Restrictions in Hong Kong

It's worth noting that Hong Kong currently only permits the trading of four cryptocurrencies — Bitcoin (BTC), Ether (ETH), Avalanche (AVAX), and Chainlink (LINK) — within its regulatory framework. This measure is intended to minimize risks while allowing for limited crypto adoption.

To further bolster its crypto hub aspirations, Hong Kong is reportedly considering tax exemptions on investment gains from cryptocurrencies for hedge funds, private equity firms, and family offices.