Hong Kong Group Warns SFC ‘Hard Start’ Could Disrupt Crypto Firms

The Hong Kong Securities & Futures Professionals Association (HKSFPA) has cautioned that the proposed implementation of new crypto licensing regimes by Hong Kong's regulators could inadvertently force compliant crypto managers to halt operations if a "hard start" approach is adopted without transitional arrangements. This "hard start" scenario would require existing firms to be fully licensed by the commencement date or cease regulated activities while applications are pending. The HKSFPA supports tighter supervision but argues that implementing the new rules—which expand regulatory oversight to virtual asset dealing, advisory, and management services—without a grace period could cause operational bottlenecks and disrupt business continuity. The group strongly urged the government to introduce a six to 12-month deeming period for existing practitioners who submit their license applications before the regulatory start date, emphasizing that rigid timelines could deter compliant firms and hinder institutional adoption of digital assets.

(Source：Cointelegraph)