Hong Kong Clears Path for Crypto Staking Under New Guidelines

Hong Kong’s Securities and Futures Commission (SFC) introduced formal rules for cryptocurrency exchanges and funds offering staking services.

The SFC announced the new framework on April 7, providing clarity for digital asset platforms that wish to offer staking. The regulator said it “recognizes the potential benefits of staking” and confirmed it will allow licensed virtual asset trading platforms to engage in staking, under strict conditions.

Crypto exchanges must now seek prior written approval before offering staking, retain full custody of staked assets, and ensure users are properly informed of all fees, lock-up periods, and associated risks. Exchanges will also be required to report their staking activities directly to the regulator.

Funds with more than 10% exposure to digital assets will also fall under the new rules. These funds can participate in staking if it aligns with their investment objectives, though they must disclose relevant risks, seek investor consent when needed, and avoid leveraged exposure.

SFC executive Christina Choi used the Hong Kong Web3 Festival to argue for a “sustainable regulatory path that strengthens core infrastructure while encouraging innovation.”

Choi acknowledged recent setbacks in sectors like NFTs, which saw sharp declines in trading volume. But she argued that a long-term approach will benefit the broader digital asset space. “Rather than chasing every new spark, we believe in a pragmatic approach,” she said.

Hong Kong’s regulatory clarity and market access continue to attract global interest, particularly as other jurisdictions maintain a more cautious stance. The SFC recently rolled out its ASPIRe roadmap, outlining a series of initiatives to streamline digital asset compliance.

Hong Kong has been promoting itself as a digital asset trading hub since 2022, a move that followed China’s sweeping ban on cryptocurrency transactions in the mainland. The city has since launched Asia’s first spot crypto exchange-traded funds (ETFs) and granted nine virtual asset trading platform (VATP) licenses, according to Financial Secretary Paul Chan.

The government is also advancing stablecoin regulations, with legislation already introduced to support further industry progress. “These initiatives reflect our effort to build a thriving digital asset ecosystem,” Choi said.