Hong Kong Is Not Becoming a Digital Asset Hub. It Already Is.

There is a particular quality to the conversations that occur in Hong Kong's financial district. The proximity of traditional capital markets infrastructure – the Stock Exchange, the major clearing and settlement functions, the concentration of asset managers and private banks – to an increasingly substantive set of regulated digital asset institutions has created an environment that few other cities can replicate. For those working at the intersection of financial market infrastructure and on-chain settlement, the question is no longer whether Hong Kong merits serious attention. It is whether the institutions shaping this market are engaging with it at the appropriate level of depth and structure.

Cosmoverse convenes its Hong Kong Institutional Digital Asset Summit in November 2026 against this backdrop, not as a response to market enthusiasm, but as a recognition that Hong Kong's regulatory and institutional development has reached a stage where structured, senior-level dialogue has become both possible and necessary.

A Financial Centre With Structural Weight

Hong Kong's standing as a global financial centre is not incidental to this discussion, it is foundational to it. As of March 2025 Hong Kong ranked third globally in the Global Financial Centres Index, behind New York and London, with a rating of 760, its strongest score in over a decade. The city ranked first in the Asia-Pacific region across all five dimensions of competitiveness assessed, and first globally in investment management, insurance, and financing. Its fintech ranking rose five places to fourth in the world. By September 2025, a further GFCI edition confirmed Hong Kong had maintained third place globally, closing the scoring gap with both New York and London to within a single point

The asset management figures reinforce this position.

The SFC's Asset and Wealth Management Activities Survey reported that total AUM in Hong Kong reached HK$35.1 trillion at end-2024 – a 13 per cent year-on-year increase – with net fund inflows surging 81 per cent to HK$705 billion.

Private banking and wealth management AUM rose 15 per cent to HK$10.4 trillion. A Boston Consulting Group analysis published in 2025 ranked Hong Kong alongside Switzerland as one of the world's two leading cross-border wealth centres, recording the highest absolute growth in cross-border assets globally, US$231 billion, in 2024.

These are not the figures of a jurisdiction in transition. They reflect a capital market of genuine depth and international reach. This matters for the digital asset discussion because it establishes the institutional gravity that now surrounds regulatory developments in the space. The firms evaluating regulated digital asset markets in Hong Kong are not exploring a frontier jurisdiction. They are extending existing infrastructure into a market where compliance culture, regulatory expectations, and institutional counterparty standards are already well developed.

A Regulatory Framework in Active Construction

What distinguishes Hong Kong's current moment is not merely the existence of a licensing framework for virtual asset trading platforms, that has been in place since June 2023, but the pace and scope of the framework's expansion into institutional-grade infrastructure categories.

The SFC's licensing regime for Virtual Asset Trading Platforms established core requirements around custody standards, asset segregation, cold storage thresholds, AML and transaction monitoring obligations, and the application of existing securities law principles to digital assets through the "same business, same risks, same rules" doctrine. As of February 2025, nine entities had received VATP licences, with further applications under review through the SFC's WINGS portal.

The regulatory surface area has since widened materially. In April 2024, Asia's first batch of virtual asset spot ETFs, covering both bitcoin and ether, listed on the Stock Exchange of Hong Kong, marking the first convergence between traditional exchange-traded product infrastructure and digital asset markets in the region. The HKMA's stablecoin licensing regime, established under the Stablecoins Ordinance passed by the Legislative Council in May 2025, came into effect on 1 August 2025, introducing structured requirements around reserves, redemption, and conduct for fiat-referenced stablecoin issuers for the first time.

Perhaps the most consequential development for institutional operators is the set of consultations and conclusions published jointly by the Financial Services and Treasury Bureau and the SFC in June and December 2025. These proposals, which drew more than 190 responses across two consultation rounds, introduced draft licensing frameworks for virtual asset dealing services and virtual asset custodian services. The dealing regime would cover the full range of intermediation activity, from OTC spot trading to block trading and brokerage. The custodian regime would extend regulatory obligations to third-party entities safekeeping private keys – a function that has until now operated without specific licensing requirements. The FSTB confirmed in December 2025 that formal legislative proposals for both regimes, along with separate frameworks for VA advisory and management services, would beintroduced to the Legislative Council in 2026.

When combined with the SFC's ASPIRe roadmap, published in February 2025 and covering access, safeguards, products, infrastructure, and relationships, the regulatory architecture taking shape in Hong Kong is among the most comprehensive and structurally coherent in any major jurisdiction. For infrastructure providers, asset managers, and custodians assessing where to build regulated operations, the direction of travel is increasingly clear.

Institutional Convergence Around Key Infrastructure Questions

The practical consequence of this regulatory trajectory is that a specific set of infrastructure questions now live across multiple categories of institutional participants. Custody – how client digital assets are safeguarded, how private key governance is structured, how cold storage requirements interact with operational liquidity needs – is moving from a consideration at the margin of institutional engagement to a central compliance obligation. Settlement finality, the interaction between on-chain transaction settlement and existing clearing obligations, and the regulatory treatment of tokenised securities alongside conventional instruments are questions that licensed intermediaries must now address in operational terms, not just analytically.

Real-world asset tokenisation sits in a similar position. The SFC provided regulatory guidance on the tokenisation of traditional financial instruments in 2023, and the listing of digital bond products has demonstrated that the infrastructure to support regulated tokenised instruments can function within Hong Kong's existing market structure. The question for asset managers and capital markets participants is no longer whether this is technically feasible. It is how to structure compliant issuance, what the secondary market infrastructure looks like, and how cross-border settlement and access interact with Hong Kong's role as an offshore RMB hub and a gateway into mainland Chinese capital markets.

Stablecoins, as newly regulated instruments, introduce a further dimension. Under the November 2025 expansion of VATP licensing conditions, HKMA-licensed stablecoins arenot subject to the 12-month track record requirement that applies to other virtual assets, and may be offered to retail as well as professional investors. This creates a distinct category of regulated on-chain payment instrument that may function across custody, settlement, and cross-border payment use cases simultaneously, each of which involves different regulatory considerations and different institutional counterparties.

The Context for Structured Dialogue

This is the environment in which senior infrastructure operators, financial institutions, asset managers, and regulators now need to engage with one another, not at the level of market development updates, but at the level of operational decisions, regulatory interpretation, and infrastructure design.

The questions that matter most at this stage are not answered by regulatory publications alone. They require the kind of structured, direct conversation between institutions that share the same compliance obligations, the same market access constraints, and the same need to understand how decisions made by regulators, clearing entities, and technology providers interact in practice. That conversation requires a convening environment commensurate with the seriousness of the decisions being made.

Our Hong Kong Institutional Digital Asset Summit, taking place November 2026, is designed for that purpose. The program spans thematic tracks covering sovereign financial infrastructure, institutional market infrastructure, digital asset market access, real-world asset tokenisation, and interoperability and cross-border payments. A closed-door Summit Day, provides senior speakers and partners with a dedicated environment for substantive exchange outside the constraints of the main program.

Cosmoverse Connect Hong Kong, held in February 2026, brought together teams from public-sector bodies, infrastructure providers, and institutional market participants for an initial phase of that dialogue. The November event builds on that foundation, with a program shaped by the regulatory and market developments that have since accelerated.

Those looking to participate in the structured dialogue shaping how regulated digital asset infrastructure develops in Hong Kong can register at lu.ma/CosmoverseHongKong and explore the broader platform at cosmoverse.org.