- Hong Kong industry urged regulators to lower compliance costs and simplify virtual asset licensing requirements for firms and professionals alike.
- According to the association, regulators backed CVAP examination reforms, including lower fees, official study materials, and flexible eligibility rules ahead.
- Industry representatives also requested clearer guidance on custody, payments, licensing, wallet requirements, insurance, and blockchain transfer procedures to reduce uncertainty.
Hong Kong’s virtual asset industry has called on the Securities and Futures Commission to reduce compliance costs and clarify several digital asset regulations. Industry representatives also want changes to the city’s qualification framework, arguing that current requirements create unnecessary hurdles for businesses and professionals.
The proposals came from the Securities and Futures Professionals Association during recent discussions with financial regulators. According to the association, the meeting included Under Secretary for Financial Services and the Treasury Chan Ho-lim and representatives from the SFC’s Intermediaries Division.
Several recommendations focused on the Virtual Asset Platform Practitioner Examination, commonly known as CVAP. Industry participants believe the existing process increases costs while slowing the entry of qualified professionals into the market.
According to the association, the SFC agreed to pursue several improvements to the qualification system. These include separating the examination from mandatory coursework, publishing official study materials, and lowering examination fees for applicants.
Moreover, regulators indicated that candidates may eventually take the examination without completing compulsory training beforehand. The proposed changes could make professional certification more accessible while maintaining industry standards.
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Industry Seeks Greater Regulatory Certainty
Besides examination reforms, the association highlighted several policy issues that remain unresolved. Consequently, discussions with the SFC and the Financial Services and the Treasury Bureau will continue in the coming months. One concern involves self-custody requirements for private equity funds that hold digital assets. Additionally, industry participants requested clearer guidance on virtual asset payment regulations and the distinction between technology providers and regulated financial activities.
The association also argued that several parts of Hong Kong’s virtual asset framework remain too broad. Consequently, businesses continue facing uncertainty when planning products, compliance strategies, and long-term investments. Another issue involves the removal of the previous 10% minimum investment exemption for virtual asset management. Industry representatives also criticized regulators for introducing the revised framework without providing a transition period.
Furthermore, firms requested additional guidance covering licensing requirements, permitted business activities, and asset allocation standards. They believe greater regulatory certainty would reduce compliance risks and improve operational planning.
Licensed Platforms Push for Lower Operating Costs
Licensed virtual asset trading platforms also raised concerns about increasing compliance expenses under the new regulatory framework. Consequently, the association encouraged regulators to review several operational requirements affecting licensed businesses. The requested review covers cold and hot wallet allocation rules, insurance obligations, hardware encryption standards, and blockchain transfer procedures. Industry representatives argued that some requirements create unnecessary costs without delivering proportional regulatory benefits.
According to the association, adopting a more flexible approach would reduce operational burdens while preserving investor protection. The group believes balanced regulation would strengthen Hong Kong’s competitiveness as more digital asset companies evaluate expansion opportunities.
Hong Kong regulators have signaled support for several qualification reforms, while broader regulatory discussions remain ongoing. Industry participants continue seeking clearer rules and lower compliance costs as the jurisdiction expands its virtual asset regulatory framework.
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