Hong Kong became the first region in Asia to approve Bitcoin and Ethereum spot ETFs in April, as virtual assets are increasingly recognized in Hong Kong. Securities firms in Hong Kong have started to offer trading services for virtual assets like Bitcoin. One Hong Kong securities firm estimates that revenue from virtual assets is expected to reach around 25% of the company’s total revenue.
According to Hong Kong Securities Times, after the transitional period of the licensing system for virtual asset trading platforms in Hong Kong officially ended on June 1, only 2 virtual asset trading platforms, OSL Digital Securities Limited and Hash Blockchain Limited, have obtained licenses. There are 11 other applicants for virtual asset trading platforms queuing to apply for qualifications.
However, it is worth noting that some Hong Kong securities firms have been allowed to directly provide virtual asset trading and advisory services to retail investors, such as Bitcoin and Ethereum.
Investors who want to trade Bitcoin and other virtual assets on Hong Kong securities firm apps need to open a virtual asset account, which involves several steps:
1. Complete the opening of a personal or corporate securities account.
2. After opening the securities account, fill out and sign 4 documents electronically or in paper form: Additional agreement for virtual asset trading, Additional risk disclosure statement for virtual assets, Risk tolerance questionnaire, and Knowledge and experience questionnaire for virtual assets.
Hong Kong securities firms have set a relatively low entry threshold for virtual asset trading, with a trading threshold starting at only $100. Investors can directly invest in virtual asset spot trading, virtual asset futures ETF trading, and private funds related to virtual assets through the securities firms’ apps.
To attract investors, some Hong Kong securities firms are launching a series of promotional activities, such as a 3-month commission-free promotion for virtual asset accounts. Some Hong Kong securities firms revealed at the end of May that revenue from virtual assets could account for 25% or even 33% of the total revenue of the company. This is mainly due to the early entry advantage of the securities firm in virtual asset business, with investments in virtual assets having roughly broken even and now generating profits.
It is understood that the introduction of cryptocurrency trading services by Hong Kong securities firms can attract two types of customers: cryptocurrency investors who need to diversify their profits into other assets after making money from trading cryptocurrencies, and traditional stock investors who may try investing in cryptocurrencies during the downturn of the Hong Kong stock market.
Several Hong Kong securities firms have started to offer Bitcoin trading. On May 6 this year, Tiger Brokers (Hong Kong) announced the official launch of virtual asset trading services, supporting 18 cryptocurrencies including Bitcoin and Ethereum, becoming the first online securities firm in Hong Kong to support both securities and virtual asset trading on a single platform.
Last November 24, Hong Kong Victory Securities announced that it had become the first licensed corporation in Hong Kong approved by the Securities and Futures Commission to provide virtual asset trading and advisory services to retail investors. Victory Securities subsequently announced on June 12 this year that its app would provide functions for depositing and withdrawing cryptocurrencies, further expanding the range of services and user experience in the cryptocurrency market.
Victory Securities also announced that it will launch a “buy stocks buy coins, equally simple” scheme in the future, allowing customers to enjoy an integrated experience of virtual asset and securities services through its unique trading platform. Similarly, on November 24 last year, Hong Kong Interactive Brokers also obtained permission for virtual asset trading for retail customers in Hong Kong, allowing trading of Bitcoin and Ethereum.
Related Reading:
Hong Kong Victory Securities launches the first stock + cryptocurrency trading app “VictoryX”, connecting HashKey and OSL.