Guotai Junan International Holdings Limited (stock code: 1788) has officially announced that it has received approval from the Securities and Futures Commission (SFC) of Hong Kong to upgrade its existing securities trading license. This upgrade authorizes the firm to provide virtual asset trading services and offer investment advice related to such services. As a result, the company's clients will now be able to trade major cryptocurrencies like Bitcoin, Ethereum, and Tether directly on its platform.
Following this news, the company's stock price surged significantly, closing at HK$3.7—a remarkable increase of 198% for the day.
First Chinese-Backed Brokerage to Obtain Virtual Asset License in Hong Kong
Guotai Junan International has become the first Chinese-backed securities firm in Hong Kong authorized to offer a full suite of virtual asset trading services. The expanded license covers virtual asset trading, investment advisory services related to virtual asset transactions, as well as the issuance and distribution of virtual asset-related products, including over-the-counter derivatives.
Early Moves in Virtual Asset Structured Products
As early as 2024, Guotai Junan International pioneered the launch of structured products based on virtual asset spot ETFs in the Hong Kong market. Later that year, the company also received SFC approval to operate as an introducing agent for virtual asset trading platforms.
In the first half of this year, the firm further obtained regulatory confirmation to distribute tokenized securities or provide advice on such products to clients. It has also initiated operations in digital bond issuance.
Hong Kong’s Evolving Regulatory Framework for Virtual Assets
In February of this year, the SFC introduced a comprehensive regulatory roadmap named "ASPIRe," aimed at fostering the development of the virtual asset market. The framework is built around five core pillars:
- A (Admission): Standards for market entry
- S (Safeguards): Investor protection mechanisms
- P (Products): Development of virtual asset products
- I (Infrastructure): Support for underlying technology
- Re (Relationships): Engagement with stakeholders
The roadmap outlines 12 specific measures intended to expand virtual asset products and services. These include evaluating the allowance of virtual asset staking and margin financing, as well as exploring virtual asset lending, derivatives, and new token offerings—though strictly for professional investors. It is important to note that the SFC did not attach a specific timeline to these proposed measures.
Key initiatives under the ASPIRe plan also include:
- Establishing new regulatory frameworks for over-the-counter virtual asset trading and custody services
- Aiming to complete legislative preparations for a custody service licensing regime by the end of this year
- Optimizing operational requirements for virtual asset trading platforms
- Strengthening measures against illegal activities
- Enhancing investor education programs
- Developing a regulatory framework for financial influencers ("Finfluencers")
This structured approach signals Hong Kong's commitment to becoming a regulated and innovative global hub for virtual asset services.
What This Means for Investors and the Market
The approval for Guotai Junan International represents a significant step in the mainstream adoption of virtual assets within traditional finance. It enables more investors to access cryptocurrency markets through established and regulated financial institutions, potentially increasing market participation and liquidity.
For the broader industry, it underscores a trend toward regulatory clarity and integration between conventional securities services and digital asset offerings.
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Frequently Asked Questions
What services can Guotai Junan International now provide?
The company is now licensed to offer virtual asset trading, provide investment advice on virtual assets, and issue or distribute virtual asset-related products, including derivatives.
Who can use these new virtual asset services?
While the services are offered through a licensed brokerage, access to specific products—especially newer or more complex ones like derivatives or lending—may be restricted to professional investors as defined by Hong Kong regulations.
What is the significance of the SFC's "ASPIRe" roadmap?
The ASPIRe roadmap provides a clear regulatory direction for Hong Kong's virtual asset market. It aims to balance market innovation with strong investor protection, covering everything from who can enter the market to how products are safeguarded.
Does this mean virtual asset staking is now allowed in Hong Kong?
Not yet. The SFC has stated it will consider allowing staking services as part of its broader roadmap, but no specific timeline or rules have been implemented for this yet.
How does this affect the average investor?
For the average investor, this development means increased access to cryptocurrencies through a regulated and familiar brokerage interface. It also signifies growing regulatory acceptance, which can lead to more secure and diverse investment products in the future.
What are tokenized securities?
Tokenized securities are traditional financial assets, like stocks or bonds, that are represented as digital tokens on a blockchain. This can make buying, selling, and settling them faster and more efficient.