The parent company of crypto news outlet CoinDesk, Bullish Group, has been officially licensed as a virtual asset trading platform (VATP) in Hong Kong. This marks a significant step in the region's ongoing efforts to position itself as a leading hub for digital asset innovation in Asia.
Hong Kong's Securities and Futures Commission (SFC) continues to expand the list of approved cryptocurrency exchanges, with Bullish becoming the tenth platform to receive a VATP license. This development reflects the city’s commitment to creating a regulated and secure environment for crypto investors and businesses.
Hong Kong’s Evolving Crypto Regulatory Landscape
In recent years, Hong Kong has introduced a series of regulatory measures aimed at fostering the growth of virtual asset services. These include new licensing regimes not only for exchanges but also for over-the-counter (OTC) crypto trading and custody service providers.
The SFC announced these updates during the "Consensus Hong Kong 2025" event. The changes are designed to enhance market efficiency and strengthen investor protection. The regulatory body is also reviewing derivative trading and margin financing options related to virtual assets.
Financial Secretary Paul Chan highlighted that Hong Kong has already launched Asia’s first spot cryptocurrency exchange-traded funds (ETFs) and approved multiple VATP licenses. The government is also advancing stablecoin regulations and supporting legislation to ensure further development of the digital assets sector.
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Strategic Importance as a Digital Asset Hub
Since 2022, Hong Kong has been proactively building its reputation as a digital asset trading center. This is particularly notable against the backdrop of mainland China’s broad prohibition on crypto trading.
Lawrence Chu, CEO of the Institute of Digital Assets (IDA), described Hong Kong as a "sandbox" for China—a controlled environment for digital asset experimentation that also serves as a bridge to global market activities.
The government is also enhancing incentives to attract crypto businesses and investors. Plans are underway to expand tax exemptions for private funds and family offices to include cryptocurrency investments.
Application and Approval Process for Crypto Licenses
The SFC is currently evaluating additional applications for VATP licenses. As of now, 16 companies are awaiting decisions on their applications. Among these, 11 are operating under "deemed-to-be-licensed" status, though the SFC advises caution when dealing with such firms.
The commission has completed its first round of on-site inspections of crypto businesses. CEO Julia Leung confirmed that all crypto trading platforms complying with the SFC’s licensing model are expected to gain approval.
This structured and compliance-focused approach aims to ensure that only trustworthy and well-managed platforms operate within Hong Kong’s jurisdiction.
Frequently Asked Questions
What does a VATP license allow?
A Virtual Asset Trading Platform (VATP) license permits companies to operate legally as cryptocurrency exchanges in Hong Kong. This includes facilitating spot trading and often other regulated services like custodial solutions.
How does Hong Kong’s crypto regulation compare to other regions?
Hong Kong is establishing a clear regulatory framework that encourages innovation while prioritizing investor protection. It is increasingly seen as a favorable destination for crypto businesses compared to more restrictive or unclear regulatory environments elsewhere.
Can mainland Chinese investors participate in Hong Kong’s crypto market?
While mainland China prohibits crypto trading, Hong Kong operates under a different legal system. Mainland investors may access Hong Kong’s licensed platforms, but must comply with local regulations and cross-border capital controls.
What are ‘deemed-to-be-licensed’ platforms?
These are companies that have applied for a VATP license and are allowed to operate temporarily while their application is under review. Investors should exercise caution as these platforms are not yet fully licensed.
Does Hong Kong plan to regulate stablecoins?
Yes, the Hong Kong government is actively working on a regulatory framework for stablecoins. Legislative proposals are already underway to ensure stability and transparency in this growing segment.
What other crypto services is Hong Kong regulating?
Besides exchange licensing, Hong Kong is introducing rules for OTC crypto trading, custody services, derivatives, and margin financing. The goal is to build a comprehensive ecosystem for digital assets.
Hong Kong’s proactive and layered regulatory strategy demonstrates its ambition to become a global digital asset leader. By combining rigorous oversight with attractive market conditions, the city is set to play a pivotal role in the future of cryptocurrency.