TLDR
Hong Kong is putting crypto investment advisers and portfolio managers into a formal licensing regime that mirrors traditional securities regulation.
- Authorities have published consultation conclusions and will table legislation in 2026 to license virtual asset advisory and management services similar to Type 4 and Type 9 securities activities.
- Any firm giving paid crypto investment advice or managing crypto portfolios in or from Hong Kong will need an SFC license, meet capital rules, and follow stricter investor protection standards.
- Firms should watch the 2026 bill, capital and custody requirements, and the lack of transitional relief, while investors will increasingly be able to prioritize regulated advisers over unlicensed operators.
Deep Dive
1. What Hong Kong Is Changing
Hong Kongs Financial Services and the Treasury Bureau (FSTB) and Securities and Futures Commission (SFC) have issued consultation conclusions on new licensing regimes for virtual asset advisory and discretionary management services, and now plan to introduce a bill in 2026.
Under the plan, virtual asset advisory services will be treated like Type 4 regulated activity (securities advice) and virtual asset management will follow Type 9 (asset management) under the Securities and Futures Ordinance, implemented via the Anti Money Laundering and Counter Terrorist Financing Ordinance.
A CoinsKid community recap of the SFCs consultation conclusions notes that regulators see this as the final leg in completing Hong Kongs digital asset framework, extending coverage beyond exchanges and custody to advice and portfolio management.
2. Who Must Comply And How
The regimes will apply to anyone in Hong Kong who, for compensation, advises on acquiring or disposing of virtual assets, manages crypto portfolios with discretionary authority, or publicly markets such services. Operating without a license could attract up to seven years in prison and a HKD 5 million fine once the rules are in force.
Capital requirements scale with risk. Advisory firms that do not hold client assets must keep at least HKD 100,000 in liquid capital, while firms holding client assets face paid up capital requirements of around HKD 5 million plus additional liquid capital, according to summary coverage of the rulemaking.
Crypto advisers in Hong Kong will increasingly look and be supervised like traditional wealth managers, which could raise barriers to entry but improve basic safeguards for clients.
3. What To Watch Next
The FSTB and SFC aim to submit the legislative amendments to the Legislative Council in 2026, after which detailed implementation timelines, licensing forms, and supervisory guidance should follow.
Regulators have indicated there will be no broad transitional regime for existing virtual asset advisers or managers, so unlicensed providers may need to either obtain licenses quickly or exit the Hong Kong market.
For market participants, key signals will be early SFC pre application discussions, the first batch of licensed crypto advisers and managers, and how strictly the SFC enforces against unlicensed advisory activity once the framework goes live.
Conclusion
Hong Kong is moving from a focus on exchanges and custody to a full spectrum regime that explicitly licenses crypto advice and portfolio management. If implemented as outlined, the city could combine tighter oversight and higher capital standards with a clearer pathway for institutional grade virtual asset advisory businesses, giving investors more regulated options and pushing informal or offshore advisers to either step up or step aside.
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