Share this article
Hong Kong Regulator Tightens Custody Standards for Licensed Crypto Exchanges
A regulatory review earlier this year found weaknesses in some exchanges’ cyber defenses, prompting the SFC to set new custody standards for licensed platforms.
Aug 15, 2025, 8:20 a.m.
What to know:
- Hong Kong's securities watchdog introduced new custody requirements for licensed crypto exchanges to protect client assets.
- The guidelines set standards for management responsibility, cold wallet operations and real-time threat monitoring.
- These measures are part of Hong Kong's strategy to become Asia's digital asset hub and differentiate itself from Singapore.
Hong Kong’s securities watchdog rolled out new custody requirements for licensed crypto exchanges, reinforcing its pledge to protect client assets as the city advances its bid to become Asia’s digital asset hub.
In a circular issued Friday, the Securities and Futures Commission (SFC) set minimum standards for licensed virtual asset trading platforms (VATPs) covering senior management responsibility, cold wallet operations, the use of third-party wallet solutions and real-time threat monitoring.
STORY CONTINUES BELOW
The move comes after the regulator’s targeted review earlier this year found “inadequacies” in some current exchanges' cybersecurity and custody controls. The guidelines also form the basis of expectations for virtual asset custodians more broadly.
By coupling product expansion with hard rules on asset protection, Hong Kong is looking to differentiate itself from regional rival Singapore, which has taken a more restrictive stance on retail crypto services.
The announcement ties directly into the Infrastructure and Safeguards pillars of the SFC’s ASPIRe strategy, unveiled in February at CoinDesk's Consensus 2025 in Hong Kong, which outlines a five-pronged plan to address liquidity fragmentation, regulatory arbitrage, and market volatility while expanding the range of regulated products and services.
The custody push follows a series of regulatory moves this year aimed at widening market access while tightening oversight.
In February, the regulator announced new licensing regimes for over-the-counter trading and custody services, alongside a review of derivatives and margin trading for virtual assets. In April, it greenlit staking services for licensed exchanges and funds, albeit under strict asset control and risk disclosure requirements.
More For You
What to know:
- As of October 2025, GoPlus has generated $4.7M in total revenue across its product lines. The GoPlus App is the primary revenue driver, contributing $2.5M (approx. 53%), followed by the SafeToken Protocol at $1.7M.
- GoPlus Intelligence's Token Security API averaged 717 million monthly calls year-to-date in 2025 , with a peak of nearly 1 billion calls in February 2025. Total blockchain-level requests, including transaction simulations, averaged an additional 350 million per month.
- Since its January 2025 launch , the $GPS token has registered over $5B in total spot volume and $10B in derivatives volume in 2025. Monthly spot volume peaked in March 2025 at over $1.1B , while derivatives volume peaked the same month at over $4B.
More For You
CFTC Launches Digital Assets Pilot Allowing Bitcoin, Ether and USDC as Collateral
Acting Chair Caroline Pham has unveiled a first-of-its-kind U.S. program to permit tokenized collateral in derivatives markets, citing "clear guardrails" for firms.
What to know:
- The CFTC has launched a pilot program allowing BTC, ETH and USDC to be used as collateral in U.S. derivatives markets.
- The program is aimed at approved futures commission merchants and includes strict custody, reporting and oversight requirements.
- The agency also issued updated guidance for tokenized assets and withdrew outdated restrictions following the GENIUS Act.
Top Stories
