TechFlow reports on January 20 that, according to The Block, the Hong Kong Securities and Futures Professionals Association (HKSFPA) has raised objections to Hong Kong's proposed regulatory framework for virtual asset management. The association specifically opposes eliminating the existing "minimum threshold," which currently allows asset management firms holding Type 9 licenses to invest up to 10% of a fund's total asset value in crypto assets without requiring an additional license, provided they notify regulators.
The HKSFPA stated that the new proposal would require a full virtual asset management license even for exposure as low as 1% to Bitcoin. This "all-or-nothing" approach is disproportionate, increases compliance costs, and hinders traditional managers from experimenting with crypto assets.
The association also criticized the requirement that virtual asset managers must hold assets through custodians licensed by the Hong Kong Securities and Futures Commission (SFC), calling it impractical for private equity and venture capital funds investing in early-stage tokens.
