- The SFC has launched new VA transaction tips in Hong Kong.
- Hong Kong’s new VA buying and selling tips are structured primarily based on the ASPIRe roadmap.
- Hong Kong brokers can now supply VA financing to their securities margin clients.
In response to reviews, the Hong Kong Securities and Futures Fee (SFC) has issued new steering for licensed brokers (VA brokers) providing digital asset (VA) buying and selling companies to increase digital asset (VA) companies to margin financing.
The Fee additionally established a high-level framework to information digital asset buying and selling platforms (VATPs) in growing VA-related leverage product choices geared toward skilled buyers.
Alignment with ASPIRe roadmap
Dr. Eric Yip, SFC’s govt director of intermediation, described the transfer as a structured improvement strategy primarily based on the ASPIRe roadmap. Mr Yip stated the focused efforts to extend liquidity display SFC’s unwavering dedication to growing Hong Kong’s digital asset market sustainably and collaboratively.
By means of background, the SFC has launched a five-pillar ASPIRe roadmap for managing the digital asset market within the area in 2025. ASPIRe is an acronym for Entry, Safeguards, Merchandise, Infrastructure and Relationships, which represents the 5 essential pillars of the area’s regulatory framework.
Facilitating VA buying and selling for institutional buyers in Hong Kong
In the meantime, the most recent steering issued by the SFC will permit brokerage companies to supply VA financing to securities margin clients, supplied the collateral is ample, amid sturdy safeguards for buyers. The brand new protocol will permit margin clients with sturdy credit score profiles and collateral to take part extra actively in VA buying and selling, thereby enhancing liquidity within the Hong Kong market underneath applicable danger administration.
Notably, that is the primary time that the SFC has set out a high-level framework to information approved VATPs within the improvement of open-ended contracts. Thereby, the SFC is facilitating the institutional introduction of digital belongings in Hong Kong, considering the provisions of the brand new protocol for leveraged merchandise.
The fee stated it goals to help buyers’ danger administration methods whereas deepening liquidity within the underlying spot market. The brand new tips will guarantee investor safety, clear product design, clear disclosure, and strong operational controls for these leveraged merchandise.
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