Hong Kong Crypto Staking Gets the Green Light

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The top Hong Kong financial regulator has approved new rules allowing licensed platforms and exchange-traded funds (ETFs) to offer crypto staking services—a strategic move that aligns with the city’s ambitions to become a global cryptocurrency hub.

Also read: Hong Kong Crypto Tax Concessions for Investments Coming Soon

The Securities and Futures Commission (SFC) announced that licensed Virtual Asset Trading Platforms (VATPs) and crypto ETFs may now engage in staking, provided they receive prior written approval. The regulator emphasized that investor demand and the role of staking in strengthening blockchain security were key drivers of this development.

SFC Prioritizes Investor Protection and Security

Under the new guidance, platforms and ETFs must implement robust safeguards to prevent operational errors, protect staked client assets, and disclose all associated risks.

“Broadening the suite of regulated services and products is crucial to sustaining the healthy advancement of Hong Kong’s virtual asset ecosystem,” said SFC CEO Julia Leung, who stressed that client asset safety remains a central focus.

Also read: Hong Kong Doubles Down on Crypto and AI to Dominate the Fintech Space

The updated rules are part of a broader roadmap introduced by the Hong Kong government in February 2024, aimed at enhancing the city’s virtual asset infrastructure. The 12-point plan includes initiatives for new token listings, derivatives, margin trading, borrowing, and lending.

Positioning Hong Kong in the Global Crypto Race

As global competition intensifies, Hong Kong’s move to legalize staking comes amid efforts by other major economies—such as the US, now under the pro-crypto leadership of President Donald Trump—to attract digital asset innovation.

Hong Kong is doubling down on its crypto-friendly policies to lure global investors and startups by offering a transparent and structured regulatory environment.

Also read: Donald Trump Halts US Aid to South Africa Over Land Seizure Plans

By legalizing staking through regulated entities, the city sets the stage for innovative business models, particularly in ETFs, which can now offer staking rewards to investors.

This not only provides opportunities for passive income but also reinforces network security, marking a new chapter in digital asset investment.

Hong Kong’s progressive approach may serve as a blueprint for other jurisdictions looking to balance innovation with investor protection in the fast-evolving world of digital finance.

Author

Steven Walgenbach

Steven's passion for cryptocurrency and blockchain technology began in 2014, inspiring him to immerse himself in the field. He notably secured a top 5 world ranking in robotics. While he initially pursued a computer science degree at the University of Texas at Arlington, he chose to pause his studies after two semesters to take a more hands-on approach in advancing cryptocurrency technology. During this period, he actively worked on multiple patents related to cryptocurrency and blockchain. Additionally, Steven has explored various areas of the financial sector, including banking and financial markets, developing prototypes such as fully autonomous trading bots and intuitive interfaces that streamline blockchain integration, among other innovations.

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