Hong Kong Securities Regulatory Commission promotes virtual asset trading compliance

The Hong Kong Securities and Futures Commission (SFC), the statutory body that regulates the securities and futures markets in Hong Kong, has also shown a positive attitude towards the virtual assets and cryptocurrency space in recent years. The China Securities Regulatory Commission stated on many occasions that it is actively studying the benefits of tokenization and is willing to cooperate with industry participants to promote the compliance and innovative development of virtual asset trading platforms.

Tokenization refers to the process of using blockchain technology to convert physical assets or rights into digital tokens, which can be traded and circulated on a decentralized network. Tokenization is considered as a way to improve asset liquidity, reduce transaction costs, increase market participation and transparency.

SFC Chief Executive Leung Fung Yee said at an event on June 5, 2023 that the SFC will embrace technology development and is open to fund tokenization. She believes that with responsible use of generative AI, asset managers will be able to make better strategic decisions, not be replaced.

In addition, the China Securities Regulatory Commission issued the "Statement on the Issuance of Security Tokens" on March 28, 2019. and regulatory requirements. The SFC urges investors to be aware of the potential risks involved in virtual assets and to exercise caution when deciding whether to invest.