Position paper Regulation of virtual asset trading platforms

On 1 November 2018, the Securities and Futures Commission (SFC) announced a conceptual framework for the potential regulation of virtual asset trading platforms and stated that it would consider whether it is appropriate to grant licences to platform operators and regulate them under its existing powers. Following this announcement, the SFC met with virtual asset trading platform operators to discuss their businesses and explain the SFC’s regulatory expectations. Having examined in depth the technical, operational and other aspects of virtual asset trading, the SFC concluded that some types of centralised platforms trading security and non-security tokens would be suitable to be regulated under the framework set out in this position paper.