Hong Kong’s push to legalize crypto – derivatives is gathering political steam. Reports suggest that senior officials view the next wave of virtual asset reforms as unlocking Bitcoin futures and options trading for professional investors, with the aim of expanding product diversity while maintaining sound risk controls.
Christopher Hui, Secretary for Financial Services and the Treasury, said that Bitcoin and Ethereum ETFs “have broadened the product diversity of the Hong Kong market, further enhancing Hong Kong’s position as Asia’s leading ETF market”. The proposal is part of Hong Kong’s efforts to strengthen its status as a digital asset hub, along with measures such as staking permissions and tax incentives for crypto funds.
According to the Securities and Futures Commission (SFC), robust risk – management measures will be a priority to ensure that trades are conducted “in an orderly, transparent, and secure manner”. Initially, the derivatives will be limited to professional investors, defined as those with over HK $8 million (US $1 million) in investable assets.
This move comes as part of Hong Kong’s aggressive build – out of a regulated virtual – asset ecosystem. In the past 18 months, the city has:
Approved Asia’s first – of – their – kind spot Bitcoin and Ethereum ETFs in April 2024.
- Greenlit staking services under controlled conditions in April 2025.
- Passed a stablecoin bill creating a licensing regime in May 2025.
- It is now reported to be finalizing a framework for crypto – derivatives trading in June 2025.
The SFC says that approved products will facilitate efficient risk transfers, boost liquidity in spot markets, and support experienced investors with new hedging and leverage strategies. Hong Kong’s pivot towards derivatives reflects a broader competition to attract institutional crypto capital. Singapore and Dubai already permit regulated crypto futures, and the absence of similar offerings has limited Hong Kong’s ability to attract hedge funds and offshore desks.
Ten virtual – asset trading platforms (VATPs) are now licensed to operate in the city, and other platforms have hinted at launching derivatives desks once regulations are in place. The SFC has recently approved two ETF issuers to revise documentation to include staking, while staking services on licensed exchanges were cleared in April under specific conditions. Collectively, these moves suggest a more open and modular future for Hong Kong’s crypto – market architecture.
Hui also revealed that the government is preparing a second policy statement on virtual assets. The new statement will explore how traditional finance and decentralized innovation can be combined to support real – world economic activities, including expanding tax concessions to recognize virtual – asset transactions by funds, single – family offices, and private – equity managers.
These policies aim to enhance the flexibility and security of Hong Kong’s financial system and attract fintech firms worldwide. If a derivatives rulebook and licensing regime are in place before the end of 2025, it would complete the three – pronged approach of Hong Kong’s crypto policy: spot ETFs, stablecoins, and derivatives, providing global investors with the necessary tools to trade, hedge, and settle digital assets onshore.
Whether Hong Kong’s deepening embrace of crypto finance will affect Beijing’s stance or prompt it to rethink the mainland’s ban on crypto remains to be seen. However, Hong Kong’s message is clear: it is building a Web3 future according to its own plan, one licensed derivative at a time.
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