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In a significant step toward solidifying its role as a global Web3 leader, Hong Kong’s Securities and Futures Commission (SFC) has introduced a set of comprehensive guidelines for crypto staking services. The move, revealed on April 7, reflects Hong Kong’s ambition to create a robust, innovation-friendly regulatory environment that supports the future of decentralized finance.
Clear Regulations for Staking Services
The SFC’s new framework targets both crypto exchanges and authorized investment funds involved in staking. Exchanges are now required to obtain formal approval before offering staking services, maintain full custody of staked digital assets, and avoid third-party delegation. These platforms must also disclose all key risks, fee structures, lock-up periods, and unstaking terms to users, while ensuring consistent reporting to the SFC.
This strategic guidance is intended to support investor protection without compromising technological progress. Chen Wu, CEO of Hong Kong-based exchange Ex.io, praised the initiative, stating it opens new avenues for licensed platforms to deliver secure and transparent staking services under clear parameters.
Guidance for Crypto-Exposed Funds
The regulations also extend to SFC-regulated crypto funds, particularly those with over 10% exposure to digital assets. These funds are limited to acquiring virtual assets available to the public and accessible through SFC-authorized platforms. Importantly, leveraged crypto exposure is banned, ensuring fund stability.
Funds may pursue staking if it aligns with their objectives, provided they disclose the activity clearly and maintain strict internal controls. If the inclusion of staking significantly alters a fund’s risk profile, investor notices or shareholder approvals may be required.
A Sustainable Web3 Vision
SFC’s executive director of investment products, Christina Choi, reaffirmed the city’s dedication to supporting Web3 development during her address at the Hong Kong Web3 Festival. Acknowledging the speculative pitfalls of early NFT markets, Choi advocated for a “pragmatic approach” — focusing on long-term growth and ecosystem sustainability rather than short-term trends.
This strategy aligns with Hong Kong’s broader digital asset ambitions. Through initiatives like the “ASPIRe” roadmap, the city aims to enhance compliance standards, improve blockchain infrastructure, and expand market access across Asia.
Hong Kong’s Web3 Future
Positioned third in the Global Financial Centres Index, Hong Kong offers crypto firms a strategic foothold in Asia, backed by clear regulatory guidance and access to vast markets. As traditional finance continues to converge with digital innovation, Choi emphasized the city’s unique opportunity to foster this transformation.
“We’ve gone from zero to one,” she said, “Now it’s time to scale — from one to 100.”
With these staking rules and a future-focused roadmap, Hong Kong is well on its way to becoming a global epicenter for Web3 evolution.