New regulations let licensed brokers offer margin loans and derivatives while limiting access to professional investors and approved collateral.
Trading crypto in Hong Kong has been limited compared with other countries. Local exchanges often didn’t offer advanced products like leveraged trading or perpetual contracts, which made it harder for traders to get better prices or deeper markets.
This week, Hong Kong’s Securities and Futures Commission (SFC) changed that. The regulator now allows licensed brokers to give margin loans for crypto trading and sets rules for perpetual contracts. This shows Hong Kong wants to make its market more useful while keeping it safe.
With the new rules, brokers can lend money to clients to trade crypto, but only if the clients have enough collateral and meet safety checks. For now, only Bitcoin and Ethereum can be used as collateral. Margin trading means borrowing money to make bigger trades. It can increase profits, but it also increases risks. The SFC said brokers must have rules to manage risk and protect clients.
Eric Yip, SFC’s Executive Director of Intermediaries, said at Consensus Hong Kong, “Our focus is on enhancing market depth and liquidity in a controlled manner.” This means the goal is to make trading easier and more efficient without letting risk get out of hand.
The SFC also set rules for perpetual contracts, a type of crypto derivative that lets investors bet on price changes without a fixed end date. Only professional investors can use them. Platforms that offer these products must follow strict rules, including limits on leverage, margin requirements, and clear warnings to users. They also have to show the SFC that they have strong internal controls to prevent problems.
These limits aim to protect ordinary investors while giving experienced traders more options. It also helps licensed exchanges compete with offshore platforms that already offer these products.
The changes fit into Hong Kong’s wider digital asset plan. Authorities are preparing laws for crypto advisory services and stablecoin issuance. The Hong Kong Monetary Authority said it will start granting licenses to stablecoin issuers soon, though only a few at first.
By allowing margin trading and perpetual contracts, Hong Kong is giving traders more tools while keeping oversight strong. The goal is to make the market deeper and safer at the same time.
