Hong Kong’s Securities and Futures Commission (SFC) announced new guidelines that enable licensed cryptocurrency trading platforms and funds to provide staking services.
Staking allows cryptocurrency owners to earn passive income through their digital assets without selling them. This practice is vital for Proof of Stake (PoS) networks, as it ensures both security and immutability.

In a recent press release, the SFC highlighted the dual advantages of staking: it boosts blockchain security and offers regulated yield-generating options for investors while implementing its broader strategy to enhance Hong Kong’s digital asset landscape via its “ASPIRe” roadmap.

Julia Leung, the SFC’s Chief Executive Officer, stated: “Broadening the suite of regulated services and products is crucial to sustain the healthy advancement of Hong Kong’s virtual asset ecosystem. But this must occur within a regulated framework that prioritizes the safety of client virtual assets.”

According to the guidelines, Virtual Asset Trading Platforms (VATPs) must maintain full control of client assets, banning any outsourcing of staking to third parties. They are also required to provide transparent disclosures of all risks linked with staking, including vulnerabilities such as blockchain errors, hacking risks, and validator inactivity.

Furthermore, VATPs must inform clients about processes, fees, minimum lock-up periods, and provisions for business continuity during outages. Authorized virtual asset funds are only permitted to stake using licensed platforms or authorized institutions, with limits set to control liquidity risks, reflecting the regulator’s cautious yet supportive approach.

This regulatory move stands in stark contrast to Singapore, which banned retail staking for investor protection back in 2023 and to the restrictive position of the U.S. Securities and Exchange Commission (SEC) regarding staking services.