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Hong Kong’s SFC Announces Guidelines For Crypto Fund License

Hong Kong SFC Guidelines Crypto Fund License

The Securities and Futures Commission (SFC) on November 1, 2018 issued guidelines for licensed corporations or service providers that manage crypto investment portfolios, or in the SFC’s terms, ‘virtual assets’.

The terms and conditions are now available on the SFC’s website

The statement said virtual asset fund managers shall maintain a minimum liquid capital requirement of HK$3 million or US$383,000. Moreover, the managers shall have transparent management as well as anti-money laundering and counter financing of terrorism measures. 

In addition, compliance, the readiness of staff in terms of techniques and general administration shall be established. The manager shall also appoint a custodian who is independent of the fund to ensure that any fund assets entrusted to it are accounted for properly.

The custodian shall be banks or financial institutions that are accredited by the SFC. The document also states that the customers can invest with fiat money. 

When analyzing the guidelines, Hong Kong’s standard in managing crypto funds is at the same standard as general fund houses that invest in stocks and derivatives. This helps assure investors that there are no scams. It will also help to increase the popularity of crypto investments in the long run. 

Hong Kong is the center of global business and blockchain technology as well as cryptocurrency. Research from the website:  www.crystalblockchain.com reveals that 22 exchange trading firms are currently registered in Hong Kong. The guidelines for fund raising through Security Token Offerings (STOs) were rolled out in March.  

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