Hong Kong is fast-tracking its ambition to become Asia’s premier virtual asset hub by launching a more efficient licensing process for crypto exchanges and encouraging broad tokenization of real-world assets (RWAs).
In May 2025, Hong Kong’s legislature passed a landmark bill governing fiat-referenced stablecoin issuers, requiring licenses, reserve holdings, redemption rules, and risk controls to be in place. The Hong Kong Monetary Authority (HKMA) expects to start issuing stablecoin licenses in early 2026, with the regulation becoming effective on August 1, 2025.
Growing tokenization led by “LEAP” framework
Besides the stablecoin law, Hong Kong has also introduced a new “LEAP” policy framework. This aims to sharpen the focus on tokenizing assets like government bonds, tokenized ETFs, gold, and renewable energy credits. Working alongside the HKMA, regulatory authorities are creating legal clarity on smart contracts, stamp duty treatment, and secondary trading infrastructure. Project Ensemble, which is a sandbox for interbank DLT settlements and tokenized bond issuance, is also underway.
Hong Kong’s regulatory outlook
Since implementing a mandatory license regime in June 2023, the Securities and Futures Commission (SFC) has introduced a “swift licensing” approach to expedite approvals. Under this system, existing operators deemed “deemed to be licensed” undergo risk-based on-site inspections rather than lengthy documentation reviews. Once they correct issues raised, they can operate under restricted licenses—even before a full third-party review lifts those limitations. As of July 2025, 11 VATPs have earned full licenses, while nine more applications are being processed under the faster system.
A consultative panel of licensed VATP operators is being formed to advise on regulatory strategy. Moreso, a virtual asset policy white paper is expected later this year. By adopting a “license fast-track” model and a public-private push for tokenization, Hong Kong is transforming into a regulated center for digital assets.