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Hong Kong\u2019s top market regulator wants to allow licensed crypto platforms to tap into global order books to spur market activity, which has been relatively muted compared to more active hubs like the United States in recent years.<\/p>\n
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Hong Kong Securities and Futures Commission Chief Julia Leung announced<\/a> the new rules at the Hong Kong FinTech Week 2025 event.<\/p>\n Currently, crypto exchanges in Hong Kong follow a \u201cpre-funded and settled instantly\u201d model under which client orders are matched and completed within a closed system. However, the new framework<\/a> introduces what the SFC describes as a \u201cShared Order Book,\u201d allowing local platform operators to match client orders with those from overseas affiliates, provided they are \u201clicensed in the relevant jurisdiction\u201d and meet international compliance standards.<\/p>\n \u201c[This] integration will enable local investors to tap global market liquidity efficiently with better price discovery and more competitive prices,\u201d Leng said.<\/p>\n To mitigate cross-border risks under the framework, platforms must put in place \u201cautomated pre-trade verification\u201d systems to confirm sufficient settlement assets and follow a \u201cdelivery-versus-payment settlement mechanism\u201d to avoid mismatches.<\/p>\n <\/p>\n The regulator also requires platforms to settle all trades with the overseas entity \u201cat least once a day\u201d and maintain a reserve fund in Hong Kong, \u201cheld on trust\u201d to compensate clients in case of settlement failure. In addition, platform operators must conduct joint \u201cunified market surveillance\u201d with their overseas affiliates and designate officers to oversee potential misconduct alerts in compliance with the SFC\u2019s standards.<\/p>\n Further, retail access to these shared order books is permitted only if clients are given \u201cclear disclosure\u201d of the cross-jurisdictional risks and \u201cexpressly elect to participate,\u201d the circular noted.<\/p>\n \u201cOverly strict requirements risk driving liquidity and talents to lighter-touch jurisdictions, but too little oversight could undermine trust and stability,\u201d Leng added.<\/p>\n Further, Leung added that the SFC may also allow locally licensed crypto brokers to access global liquidity pools in the future, and that could open up a faster path for players like Binance to enter the market with a broker license, without having to acquire a full crypto exchange license.<\/p>\n Hong Kong\u2019s recent efforts remain aligned with its ambitions to become a leading digital asset hub in Asia, but so far, these efforts have not delivered the level of market activity or trading volume regulators had hoped for. In terms of crypto adoption, Hong Kong still lags behind regional counterparts like India, Japan, and Vietnam, as suggested by Chainalysis data<\/a>.<\/p>\n At the same time, Hong Kong has faced some resistance from mainland authorities, who are concerned about the influence of privately issued digital currencies and the risks tied to cross-border stablecoin activity.<\/p>\nCrypto market activity remains muted in Hong Kong<\/h1>\n