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Hong Kong Sets Out Plan to Regulate Crypto, Encourage Tokenization
In its second policy statement on the subject, the government said it intends to take further steps to regulate digital asset service providers, exchanges and stablecoins.
Updated Jun 27, 2025, 1:29 p.m. Published Jun 26, 2025, 3:57 p.m.
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What to know:
- Hong Kong’s government released its second major policy statement on digital assets.
- It said it wants to establish a regulatory framework focusing on risk management and investor protection as it strives to become a global hub for the industry.
- The Securities and Futures Commission will oversee the regulation of custodians, digital asset service providers, exchanges and stablecoins, with public consultations on licensing regimes starting soon.
Hong Kong’s government released its second major policy statement on digital assets, underlining its pledge to set the region up as a global hub for the industry and saying it plans to establish a regulatory regime that puts risk management and investor protection center stage.
The framework will be overseen by the Securities and Futures Commission and apply to custodians, digital asset service providers, exchanges and stablecoins, the government said Thursday. Public consultations on the licensing regimes will start shortly, it said.
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Hong Kong has been making moves in recent years to strengthen its position in the industry, and the statement builds on an earlier pronouncement from 2022, when it said it was "ready to engage" with participants. In December, it granted licenses to four crypto exchanges, and last month passed a law allowing it to license stablecoin issuers from Aug. 1.
The Financial Services and the Treasury Bureau (FSTB) and the Hong Kong Monetary Authority will also review the legal regime on the tokenization of real-world assets (RWAs) and financial instruments, the government said. The review will look at tokenized bond issuances and transactions. The government is particularly looking at the practical use of tokenization plus how to diversify use cases, Financial Secretary Paul Chan said in the statement.
Worldwide, RWA tokenization has grown by 380% in just three years and reached $24 billion this month, according to a first-half 2025 report from RedStone, Gauntlet and RWA.xyz.
"The Government will regularise the issuance of tokenised Government bonds and incentivise the tokenisation of RWAs to enhance liquidity and accessibility through, among other initiatives, clarifying the stamp duty treatment for tokenised exchange traded funds (ETFs)," the government said. It also welcomes secondary market trading of these tokenized ETFs on licensed trading platforms.
Nations across the globe like the U.K., U.S., South Korea and Pakistan are establishing their regimes for crypto companies as interest in the sector continues to grow. The European Union's rules for the industry, the Markets in Crypto Assets (MiCA) legislation, were published in 2023 and took effect last year.
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