Hong Kong’s SFC Unveils 3 New Crypto Initiatives to Improve Liquidity

• Hong Kong’s SFC has unveiled 3 crypto initiatives to improve market liquidity.
• The Hong Kong crypto regulatory push has helped bridge capital between TradFi and Web3.
• The crypto regulatory framework in Hong Kong has helped increase adoption amid global competition.

The Hong Kong Securities and Futures Commission (SFC) announced three new crypto initiatives at the Consensus Hong Kong 2026. Under CEO Julia Leung, Hong Kong’s SFC announced the introduction of margin financing for creditworthy clients.

She also announced a framework for professional investors to access perpetual contract trading with transparent rules. Leung also announced that the SFC has relaxed restrictions on affiliated market makers, especially if they operate independently.

Hong Kong’s Crypto Regulatory Push to Bridge TradFi and Web3

Hong Kong’s SFC has deliberately created structured and compliant environments to bridge the gap between digital assets, web3 protocols, and traditional finance (TradFi). According to Leung the SFC is keen to make Hong Kong a leader in the structured adoption of digital assets as a means to spur growth in the economy.

To kickstart margin financing for creditworthy clients using crypto, CEO Leung stated that only Bitcoin (BTC) and Ethereum (ETH) will be allowed. Furthermore, she stated that most crypto assets are highly volatile thus not the most suitable as collateral for margin financing.

According to Leung, the SFC has created a framework for professional investors to access perpetual contracts. Notably, the SFC released a principles-based framework to guide licensed Virtual Assets Trading Platforms (VATPs) on developing and offering leveraged perpetual contracts that exclude retail investors.

The move is focused on enhancing market depth, while ensuring optimal investor protection. Leung also noted that the SFC has a new crypto initiative focused on relaxed restrictions on affiliated market makers, especially if they are operationally independent.

These SFC’s crypto initiatives will be building on Hong Kong’s post-2022 regulatory push. In the past few years, Hong Kong has licensed nearly a dozen virtual asset trading platforms.

As such, the SFC has helped bridge liquidity between digital assets, web3, and TradFi. Furthermore, the SFC has worked closely with the Hong Kong Monetary Authority (HKMA) to regulate stablecoins and crypto assets in accordance with the set global standards.

What’s the Expected Market Impact?

The Hong Kong SFC’s latest crypto initiatives will have a long-term impact on digital assets. Specifically, the demand for Bitcoin and Ethereum will surge in Hong Kong, especially among institutional investors. 

Furthermore, Hong Kong has attracted institutional investors from mainland China seeking to get exposure to regulated crypto products. As such, the liquidity in the crypto market will grow exponentially as the adoption involves more investors.

Already, Hong Kong’s spot Bitcoin and Ethereum exchange-traded funds have existed alongside the United States-based products. According to market data from SoSoValue, Hong Kong’s spot Bitcoin ETFs have accumulated over $261 million in total net assets.

Related: Hong Kong’s SFC Boosts Virtual Assets Trading With New Guidelines