Hong Kong Securities Regulator Tightens Crypto Custody Standards

Hong Kong's Securities and Futures Commission (SFC) has introduced stringent custody requirements for licensed VIRTUAL asset trading platforms. The move comes amid a surge in global cybersecurity breaches that have resulted in billions of dollars in investor losses.

The new guidelines mandate robust safeguards, including senior management oversight, cold wallet infrastructure, and real-time threat monitoring. These measures align with the SFC's ASPIRe regulatory roadmap, designed to position Hong Kong as a trusted hub for digital assets.

Regulators identified critical vulnerabilities—such as weak third-party wallet controls and inadequate transaction verification—as key factors in recent exchange hacks. "Client asset protection must remain paramount," emphasized Eric Yip, the SFC's executive director of intermediaries.