How to Obtain a Hong Kong Crypto Exchange License?
Published on: 17 March 2026By Aaron Richards
Hong Kong is a reputable financial jurisdiction that is preferred by banks and financial institutions across the globe. When it comes to the virtual asset segment, operating a licensed crypto exchange in Hong Kong puts you at the center stage of the evolving market.
With the help of a Hong Kong crypto exchange license, you can onboard international clients and list crypto assets of firms on your exchange. If you are looking to obtain a crypto license in Hong Kong, this article can help you learn about the license, its types, and how to apply for the ideal one.
What is a Crypto Exchange in Hong Kong?
A crypto exchange is a regulated marketplace that allows users to buy and sell virtual assets such as Bitcoin, Ethereum, and more. It facilitates trade between buyers and sellers by matching the orders placed on a crypto trading platform.
Hong Kong has a dual licensing framework and typically requires two sets of licenses to operate a centralized exchange in the jurisdiction: a Virtual Asset Service Provider (VASP) license and the Type 7 license. Both licenses complement each other and allow a firm to offer seamless trading services to its users.
Moreover, the business may also require a Type 1 license to allow trades in security tokens on the exchange.
Crypto exchanges in Hong Kong are governed by the Cap. 571 Securities and Futures Ordinance (SFO) and Cap. 615 Anti-money Laundering and Terrorist Financing Ordinance (AMLO). The exchange ecosystem is regulated by the Securities and Futures Commission of Hong Kong (SFC).
What are the Types of Hong Kong Crypto Licenses?
Given that, Hong Kong has a dual licensing regime and differentiates virtual assets based on the technical and legal nature, there are two types of assets: non-security tokens and security tokens.
Non-security tokens refer to the direct buying and selling of virtual assets such as Bitcoin or Ethereum. On the other hand, security tokens are the representation of traditional shares, bonds, or debentures on the blockchain.
As per the legal demarcation, any firm that seeks to operate a licensed crypto exchange in Hong Kong must satisfy the requirements of both the SFO and AMLO legal frameworks.
In the table, we list out the licenses that a firm requires to operate a centralized exchange in Hong Kong:
Activity
What it allows you to do
License Needed
Governing Law
Exchange Operation
Run any business related to virtual assets (trading platform, exchange, custody).
VASP License
AMLO (Cap. 615)
Matching Engine
Use an electronic system to automatically match buy and sell orders.
Type 7 License
SFO (Cap. 571)
Dealing in Securities
List and trade digitized tokens (pegged to blockchain) that represent a stake in the equity, debt, or profits of a firm.
Type 1 License
SFO (Cap. 571)
Which Documents are Required to Obtain a Hong Kong Crypto Exchange License?
The required documents can vary based on the type of Hong Kong crypto exchange license you wish to obtain. The list of key documents includes the following:
Passport and national ID of directors and shareholders
What is the Process to Obtain a Hong Kong Crypto Exchange License?
The SFC has streamlined the process of obtaining a Hong Kong crypto exchange license and has removed the two-step assessment by an external assessor. The steps mentioned below must be followed to acquire the license:
Step 1: Appoint a Company Secretary
The first step is to appoint a company secretary under the Companies Ordinance Cap. 622. They are responsible for meeting all the legal requirements and act as the intermediary between the government and the firm.
Step 2: Register a Company
As Part 5B of the Cap. 615 outlines that only locally registered entities can obtain a Hong Kong crypto license; company registration in Hong Kong is essential to set up a licensed exchange. It must be ensured that the firm is lawfully registered under the Companies Ordinance.
Step 3: Ensure Physical Presence
To operate in the virtual asset segment, you must have a physical presence in Hong Kong. This can be maintained by renting an office, hiring staff, etc., as it allows SFC easy access to the business records and books for timely audits.
Step 4: Meet Capital Requirements
The firm must maintain sufficient paid-up and liquid capital. Given that the minimum paid-up capital requirement is HKD 5 million, it must be maintained in a local Hong Kong bank account. Additionally, the minimum liquid capital requirement of HKD 3 million must be kept to meet operational expenses for a period of 12 months.
It must be noted that SFC does not consider virtual assets for liquidity obligations, so you must hold high-quality liquid assets such as treasury bonds, cash, or other deposits to meet the same.
Step 5: Draft Guidelines
With the virtual asset business in Hong Kong being a regulated activity, proper guidelines must be put in place. It involves outlining what types of tokens the exchange can list, a surveillance system to check transactions, and measures to detect fraudulent transactions, among others. Moreover, it must ensure there is no conflict of interest between the clients and the firm.
Step 6: Apply for a License
You can apply for a Hong Kong crypto exchange license from the Web-Based Integrated Government System (WINGS) portal. You can club the application forms for Type 1, Type 7, and VASP license and submit them on the portal.
Step 7: Undergo Fit and Proper Test
The next step involves a fit and proper test, which an ultimate beneficial owner (UBO) and key personnel have to undergo. A UBO is subject to rigorous scrutiny under section 53ZRJ of the Cap. 615, which governs the fit and proper test. Under this, the authorities scrutinize the financial background or solvency of the UBO. It also checks the person's reputation, character, reliability, and ability to provide the services.
It must be ensured that the UBO must not be convicted of any offence under Section 14 of the United Nations (Anti-Terrorism Measures) Ordinance, or for any other drug or organized crime-related offences.
Step 8: Appoint External Assessor and Nominate Key Personnel
The next step involves the appointment of an External Assessor (EA) and other key personnel, including Responsible Officers (RO) and Managers-in-Charge (MICs). The EA verifies your firm’s policy and internal systems on behalf of SFC. The appointed ROs and MICs must also undergo a fit and proper test.
Note - At least one RO must be a board member and a Hong Kong resident.
Once all the above steps are completed, the Hong Kong crypto exchange license is issued, enabling you to commence operations.
How Can Business Setup Worldwide (BSW) Help?
Operating a licensed crypto exchange in Hong Kong gives you access to a lucrative and evolving virtual asset market. However, the process of obtaining a Hong Kong crypto exchange license can be overwhelming. From registering a new firm to applying for the right license, Business Setup Worldwide can help. We have 8 years of expertise in offshore company formation across the globe. Our legal experts support you in fulfilling all the criteria and staying compliant. Contact us now to get started!
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Aaron Richards is a seasoned expert with over six years of
experience who specializes in offshore company formation, trust
and foundation setup, and corporate services. Through his blogs,
Aaron shares valuable insights to guide clients in making informed
decisions about their global business needs.
Frequently Asked Questions
1. Can a firm with a Hong Kong crypto exchange license serve retail investors?
Yes, following regulatory updates, licensed virtual asset trading platforms can offer services to retail investors. However, they must implement strict investor protection measures, risk disclosures, suitability assessments, and token due diligence procedures.
2. What token listing requirements must exchanges follow in Hong Kong?
Licensed exchanges must conduct rigorous token due diligence before listing any virtual asset. This includes evaluating the project's regulatory status, liquidity, governance structure, market risks, and whether the token is suitable for retail investors.
3. Are periodic external audits required after obtaining the Hong Kong crypto license?
Yes. Licensed platforms must undergo ongoing independent assessments and audits to ensure continuous compliance with SFC regulatory standards.
4. Are crypto exchanges required to establish a token admission and review committee?
Yes. The SFC expects licensed platforms to establish a dedicated token admission and review committee to evaluate digital assets before listing.
5. Are crypto exchanges required to maintain compensation arrangements for client assets?
Yes. Licensed exchanges must implement compensation arrangements such as insurance coverage or other safeguards. These measures are designed to mitigate potential losses arising from hacking, theft, or operational failures.
