Hong Kong's Securities and Futures Commission (SFC) says it will bring crypto funds under its securities regulations to improve investor protection.
In a circular issued Thursday, the financial regulator said that investment funds based in Hong Kong and that intend to invest more than 10 percent of their gross portfolios into "virtual assets," either directly or indirectly via intermediaries, will have to be licensed and registered with the agency.
In a footnote, the SFC further explained that "virtual assets" are defined as "digital tokens (such as digital currencies, utility tokens or security or asset-backed tokens) and any other virtual commodities, crypto assets and other assets of essentially the same nature."