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Circular on provision of Relevant Stablecoin service by virtual asset trading platforms and licensed corporations
01
Jun
Jun
On 27th May 2026 the Securities and Futures Commission (SFC) published a circular focusing on the streamlined regulatory standards for licensed virtual asset trading platforms (VATPs) and licensed corporations (LCs) engaging with “Relevant Stablecoins.”
With the authorized recognition from HKMA, reserve backed stablecoins pose significantly lower risks regarding market manipulation and structural transparency than unbacked virtual assets (VAs), the SFC has implemented critical exemptions to the existing VATP Guidelines and Intermediary Joint Circular. Most importantly, the relevant Stablecoins are entirely exempt from standard retail token liquidity and independent indexation requirements.
For intermediaries servicing clients who trade these instruments exclusively, the mandate to conduct formal VA knowledge assessments is waived, but firms must still evaluate the client’s intended use-case objectives. Furthermore, holdings of relevant Stablecoins are excluded from the calculation of a client’s aggregate VA investment exposure limits. While these stablecoins are classified as non-complex products, standard suitability protocols remain strictly applicable upon active solicitation or recommendation which prohibit firms from using commercial incentives like commission rebates as the primary justification for a product push.
Operationally, the circular significantly enhances flexibility for LCs. Intermediaries may now partner directly with HKMA-licensed issuers to provide dealing services and utilize omnibus accounts with VATPs operating under a professional investor-only condition to intermediate for retail clients, provided the underlying tokens clear the VATP’s internal retail admission reviews. Besides,custody frameworks have also expanded which LCs are permitted to receive, hold, or withdraw client stablecoins through segregated accounts maintained directly with the respective HKMA-licensed issuer.Lastly, as these assets fall under active HKMA oversight, intermediaries are no longer required to obtain prior written approval from the SFC before offering a relevant Stablecoin for client trading. However, firms must simply provide advance written notification to the regulator regarding any planned token admission, suspension, or removal, while ensuring their internal compliance policies, procedures, and client disclosures are promptly updated.
Sources:https://apps.sfc.hk/edistributionWeb/gateway/EN/circular/doc?refNo=26EC26