Hong Kong: Financial Services and the Treasury Bureau and Securities and Futures Commission closes consultation on Regulation on Virtual Asset Custodian Services

On 29 August 2025, Hong Kong's Financial Services and Treasury Bureau (FSTB) and Securities and Futures Commission (SFC) closes the public consultation on the Regulation on Virtual Asset Custodian Services. The regulation applies to entities safekeeping virtual assets or private keys for clients, including banks, fund managers, and standalone custody providers. The regulation requires licensed operators to meet minimum capital requirements of HKD 10 million, comply with anti-money laundering obligations, segregate client assets, and maintain robust cybersecurity controls. The SFC will regulate most providers, and the HKMA supervises banks and stored value facilities. The regulation provides for penalties that include up to HKD 5 million fines and seven years' imprisonment for unlicensed operations.