Web3 Lawyer's Interpretation: Hong Kong SFC Roadmap, Virtual Asset Market May Welcome New Situation

On the afternoon of February 19, 2025, the Securities and Futures Commission (SFC) of Hong Kong officially released the "Virtual Asset Roadmap" to address various issues encountered in the current development of the virtual asset trading market in Hong Kong. Known as "A-S-P-I-Re," the roadmap is based on the five pillars needed for the development of the Hong Kong virtual asset market: Access, Safeguards, Products, Infrastructure, and Relationships. It proposes 12 major measures to convey Hong Kong's comprehensive development and regulatory direction in the coming years to investors and institutions. The background of the development of the "A-S-P-I-Re" roadmap is that Hong Kong, as one of the global financial centers, began to gradually explore the regulatory framework for virtual assets as early as 2018. In 2023, the SFC took the lead in including virtual asset trading in the regulatory scope, requiring virtual asset trading platforms (VATPs) to be licensed and introducing investor protection measures consistent with TradFi. In April 2024, the first virtual asset Spot ETF in Asia was successfully listed on the Hong Kong Stock Exchange. However, encryption沙律 believes that the development of Hong Kong's virtual asset market still faces some unresolved difficulties and constraints, particularly in terms of market activity, market access restrictions, and product categories. The "A-S-P-I-Re" roadmap overview outlines the five pillars and 12 initiatives to address the current challenges in the Hong Kong virtual asset market. Pillar A (Access) aims to simplify market access and provide a clear regulatory framework to attract global high-quality virtual asset service providers to Hong Kong. Pillar S (Safeguards) aims to strengthen Compliance control by providing clear regulatory guidance to align the virtual asset market with the TradFi framework. Pillar P (Products) seeks to broaden product categories and service innovation to provide multi-level and differentiated investment vehicles based on investors' risk tolerance. Pillar I (Infrastructure) aims to upgrade market supervision capabilities, utilize advanced data analysis and monitoring tools, and enhance cross-institutional cooperation and market monitoring capabilities. Pillar Re (Relationships) aims to enhance investors' communication and education through extensive information exchange and educational training to improve their understanding of virtual assets and risk prevention capabilities. Throughout 2024, the global virtual asset market experienced a critical reshaping. With the interweaving and collision of various factors such as the significant rise in technology stocks, the continuous expansion of payment channels, changes in global Liquidity trends, and the relaxation of encryption regulation triggered by the Russia-Ukraine war, new market reactions have emerged, and the problems under the new situation have gradually surfaced.