Hong Kong VASP/VATP Licence: The Virtual Asset Trading Platform Regime and Application Process

Since 1 June 2023, operating a centralized virtual asset trading platform in Hong Kong, or actively marketing such a platform to Hong Kong investors, requires a licence from the Securities and Futures Commission (SFC). The regime runs on two tracks: activities involving security tokens fall under Type 1 and Type 7 regulated activities of the Securities and Futures Ordinance (Cap. 571), while trading in non-security tokens falls under the VASP regime of the Anti-Money Laundering Ordinance (Cap. 615). In practice, a platform trading both kinds of tokens needs licences under both tracks. Unlicensed operation carries a maximum fine of HKD 5,000,000 and 7 years' imprisonment.

Mind the scope boundary: this regime targets centralized trading platforms (those matching orders and holding client assets). Over-the-counter fiat-to-virtual-asset exchange shops and pure technology vendors are not yet within the VATP licensing scope, but Hong Kong is advancing legislation for OTC and custody services, so operators should track the latest consultation papers from the Financial Services and the Treasury Bureau and the SFC.

Financial thresholds: paid-up capital of at least HKD 5 million, liquid capital of at least HKD 3 million (or the statutory calculation, whichever is higher), plus liquid assets equal to 12 months of operating expenses. Organizational thresholds: a company incorporated in Hong Kong with at least 2 responsible officers (ROs) approved by the SFC. Asset custody is the focus of the review: client virtual assets must be held on trust by a wholly owned associated entity, 98% of client virtual assets must be kept in cold storage, and a token admission committee must set listing criteria. On top of that come group-wide fit and proper tests, insurance or compensation arrangements, and AML/CFT requirements.

Applications are prepared under the SFC's Licensing Handbook for VATPs and filed through the WINGS online platform (wings.sfc.hk). The review includes Phase 1 and Phase 2 reports from an external assessment expert; successful applicants first receive approval in principle, then the formal licence once conditions are met. The transitional deeming arrangement under the Anti-Money Laundering Ordinance ended on 1 June 2024, so a full new application is now the only route.

The SFC website publishes three key lists: licensed virtual asset trading platforms, applicants under review, and an explicit warning list of unlicensed or suspicious platforms. Use these official lists when choosing a platform or running due diligence. The regulator has not published a standard fee specific to VATP applications.