Compliance Check: Hong Kong SFC to Inspect Crypto Firms Post-License Deadline

The Hong Kong Securities and Futures Commission (SFC) has announced plans to conduct on-site inspections of local virtual asset trading platforms (VATPs) that have not yet completed their regulatory applications after the June 1 licensing deadline. Following reminders issued on May 28, crypto companies were required to obtain licences by June 1, with unlicensed operation constituting a criminal offence thereafter. The SFC emphasised a focus on client asset protection and Know Your Customer (KYC) procedures during these inspections. It advised investors to only engage with SFC-licensed platforms and cautioned companies against marketing services or onboarding new retail clients without formal licensing. Recent developments have seen a decrease in the number of crypto exchanges seeking operational licences, with 11 withdrawing applications ahead of the deadline. Among those approved, only OSL Digital Securities Limited and Hash Blockchain Limited have obtained licences to operate in Hong Kong, according to the SFC.