The Securities and Futures Commission (SFC) of Hong Kong recently held a press conference addressing growing public concerns about virtual asset trading platforms. In response to the JPEX scandal, the regulator announced enhanced investor education initiatives and the upcoming publication of several official lists related to virtual asset service providers. Among these, the "List of Virtual Asset Trading Platform Applicants" has drawn significant attention, initially featuring four local companies.
These four firms—HKVAX, HKBitEx, Hong Kong BGE Limited, and Victory Fintech Company Limited—are all Hong Kong-based entities. Interestingly, this preliminary list did not include some previously rumored applicants, indicating that several prominent crypto exchanges have not yet formally submitted their applications.
Detailed Background of the Four Applicants
HKVAX (Hong Kong Virtual Asset Exchange)
HKVAX appears to be the most advanced among the four in the licensing process. The exchange has publicly stated that it has received in-principle approval from the SFC. According to a press release dated August 11, the final approval will authorize the company to conduct Type 1 (dealing in securities) and Type 7 (automated trading services) regulated activities.
Once fully licensed, HKVAX plans to offer three core services: over-the-counter (OTC) brokerage, an institutional-grade trading platform, and digital asset custody solutions. The exchange’s co-founder and Chief Operating Officer, Kenneth Fok, shared that the application process has already taken three years, with an estimated additional six months required before formal licensing.
The leadership team includes CEO Wui Leung Ng, previously the Managing Director at CITIC Futures International and currently serving as Vice Chairman of the Financial and Treasury Services Committee of the Hong Kong General Chamber of Commerce (HKGCC).
Victory Fintech Company Limited
Victory Fintech is a subsidiary of Victory Securities, a well-established Hong Kong-based securities firm. The company’s executive directors include Amelia Gao, who is also the Chairman of the Hong Kong Securities Association.
Victory Securities has been actively expanding into the digital asset sector, already holding SFC licenses for Type 1 (virtual asset trading), Type 4 (virtual asset advisory), and Type 9 (virtual asset asset management) activities. The firm promotes the slogan “Stocks and coins, equally simple.”
In March 2023, Victory Securities announced a strategic partnership with OSL, another licensed virtual asset platform. Victory Fintech’s official website claims its trading application is the first compliant virtual asset trading app in the Hong Kong market. Initially, it will offer crypto trading services provided by OSL, exclusively for professional investors.
HKBitEx
Founded in 2019 by several former executives of the Hong Kong Exchanges and Clearing Limited (HKEX), including co-founder Gao Han, HKBitEx completed a US$10 million Series A2 financing round in 2020. The investment was led by Axion Global Investment Limited (a wholly-owned subsidiary of Hong Kong-listed company A-Living Group) and Hanwha Asset Management.
According to its official introduction, HKBitEx aims to provide a compliant and regulated digital asset spot trading and OTC platform for global professional investors. It was among the first batch of companies in the Asia-Pacific region to apply for an SFC virtual asset trading platform license.
Hong Kong BGE Limited (HKBGE)
HKBGE is an affiliate of HKE Holdings Limited, incorporated in April 2021. It fully owns HKBGE TSP Limited, which obtained a Trust or Company Service Provider (TCSP) license under the Anti-Money Laundering and Terrorist Financing Ordinance (AMLO) in September 2021. This allows it to provide virtual asset custody services for the HKBGE trading platform.
HKE Holdings, the parent company, has a market capitalization of approximately HK$2.3 billion. Its Chairman and majority shareholder is 31-year-old Lian Haomin, who attracted media attention in 2022 for filing a winding-up petition against China Evergrande Group. HKBGE’s CEO, Au Kin Nam, was a founding member of HashKey Digital Asset Group and previously served as its Chief Operating Officer.
The company is currently applying for a virtual asset trading platform license. Its Chief Legal Officer, Li Mingjun, noted that the application process has taken about one to two years and is now in the confirmation stage, with the next milestone being in-principle approval. Based on prior examples, formal licensing usually follows within four to six months after in-principle approval is granted.
Regulatory Context and Future Lists
The SFC has announced plans to publish multiple lists to improve transparency and protect investors. These will include:
- The List of Licensed Virtual Asset Trading Platforms
- The List of Closed Virtual Asset Trading Platforms
- The List of Deemed-to-be-Licensed Virtual Asset Trading Platforms
- A dedicated list of suspicious virtual asset trading platforms on the SFC website
This move is part of a broader effort to clean up the industry and restore confidence following recent events.
Broader Industry Movements
While these four local firms are leading the current application wave, other global exchanges have also expressed interest in the Hong Kong market. For example, HTX Global Advisor Justin Sun previously mentioned in an interview with CoinDesk that HTX expected to obtain a license within 6 to 12 months, though no recent updates have been provided. Additionally, OKX has indicated via its Chinese Twitter account that it plans to submit a formal application before the end of October.
The path to becoming a fully regulated virtual asset service provider in Hong Kong is rigorous, demanding significant time and resources to meet the SFC's high compliance standards. For those looking to understand the operational and technical requirements for such platforms, comprehensive resources are available. 👉 Explore the licensing framework for digital asset platforms
Frequently Asked Questions
What is the significance of the SFC's new lists?
The lists provide much-needed clarity and safety for investors. They distinguish between licensed, applicant, closed, and suspicious platforms, helping users make informed decisions and avoid potential scams.
Who can use the services of these newly licensed platforms?
Initially, many licensed services, especially those from new applicants, are expected to be available only to professional investors, as defined by the SFC. Retail investor access may be expanded gradually as the regulatory framework matures.
How long does the entire licensing process typically take?
Based on current examples, the entire process from application to formal licensing can take several years. After receiving in-principle approval, it usually takes another 4 to 6 months to meet all conditions and obtain the full license.
What types of activities do these licenses cover?
The licenses can cover various activities, including Type 1 (securities dealing), Type 7 (automated trading services), and specific virtual asset services like trading, advisory, and asset management.
Are there other major exchanges applying for a license in Hong Kong?
Yes, other major global exchanges like OKX have announced plans to apply. However, the process is lengthy, and their applications are not yet reflected in the initial public list of applicants.
How does this regulation protect investors?
The licensing framework mandates strict compliance with anti-money laundering (AML), cybersecurity, custody, and financial reporting standards. This reduces operational risk and provides legal recourse for investors, creating a safer trading environment.