Hong Kong’s SFC Cracks Down: New Crypto Custody Rules After Global Security Failures
Hong Kong’s Securities and Futures Commission (SFC) is tightening the screws on crypto custody—just as the industry reels from a string of global breaches. No more cowboy storage: exchanges now face stricter asset segregation, insurance mandates, and third-party audits. Finally, regulators are treating crypto like the billion-dollar asset class it is—even if Wall Street still pretends it’s a 'niche' market.
Why now? Because 2025’s $2.3B in crypto hacks proved self-custody isn’t a feature—it’s a bug. The SFC’s move mirrors Japan’s FSA crackdown last year, but with a twist: cold storage requirements now cover 98% of assets, and exchanges must prove reserves hourly. Good luck fudging those numbers now.
Critics call it overreach. Bulls call it overdue. Either way, Hong Kong just made crypto safer—while exposing how laughably loose the 'wild west' era really was. Next stop? Maybe the SEC will finally learn that 'protection' doesn’t mean 'strangulation.' But we won’t hold our breath.
