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crypto.news 2025-04-07 07:46:14

Hong Kong SFC allows licensed crypto firms to provide staking services

Hong Kong financial authorities have officially allowed crypto firms to provide staking services for customers. However, they must abide by guidelines meant to protect users from associated risks. According to a notice published by the Securities and Futures Commission on April 7, crypto firms operating in the region that hold a virtual asset trading platforms license may offer staking services. Though, they must take necessary measures to protect customers and fully disclose the potential risks associated with staking virtual assets. Staking allows customers to generate yield through their crypto holdings. This is done through “locking up” the crypto asset for a certain period of time and accumulating interest from it. Platforms usually offer this feature through a proof-of-stake consensus mechanism that generates returns and distributes it to investors. Before firms can start offering staking services in their Hong Kong product suite, they must first receive formal approval from the SFC. The prior written approval will include specific requirements that crypto platforms have to follow before they can start providing staking services. The SFC claimed that it has adjusted its circular framework on virtual asset funds to facilitate staking. One of the requirements mandates companies to only partner with licensed VATPs and authorized institutes for staking crypto assets. You might also like: Fake ‘Hong Kong coin’ promoted by chief executive impersonator account Hong Kong regulators aim to prioritize crypto industry Chief Executive Officer of the SFC, Julia Leung, stated that expanding their virtual asset guidelines to accommodate crypto staking products is an important part of encouraging growth within Hong Kong’s digital asset ecosystem. “But the broadening must be done in a regulated environment where the safety of client virtual assets continues to be front and center of the compliance framework for offering such service,” said Leung in her statement. Hong Kong regulators have been making regulatory moves to accelerate the growth of their crypto industry. By the end of 2024, the region was criticized for its slow-moving licensing process, falling behind other Asian countries like Singapore . Earlier today during the Hong Kong Web3 Festival 2025, the Hong Kong government announced that it would soon launch a stablecoin legislation alongside licenses for over-the-counter transactions and custody businesses. Moreover, it aims to also allow licensed spot ETFs to provide staking services. Read more: Hong Kong to focus on tokenization and stablecoins moving forward

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