Hong Kong-based digital asset firm HashKey has officially launched its over-the-counter (OTC) brokerage service, HashKey Brokerage, following regulatory approval to operate a licensed virtual asset exchange for retail investors. This milestone positions HashKey as one of the first platforms in Hong Kong authorized under the city’s new Virtual Asset Service Provider (VASP) licensing regime to offer crypto trading services to the general public.
While the Securities and Futures Commission (SFC) has yet to formally confirm the license upgrade, HashKey announced that it has successfully upgraded its Type 1 (dealing in securities) and Type 7 (automated trading systems) licenses to include retail access. The move marks a pivotal development in Hong Kong’s evolving digital asset landscape.
“HashKey Exchange is a licensed virtual asset exchange in Hong Kong and has upgraded its Type 1 and Type 7 licenses to provide retail services. Now, all users can enjoy a secure and seamless trading experience!” – HashKey Exchange, X (formerly Twitter)
Retail investors can now trade approved high-value cryptocurrencies such as Bitcoin and Ethereum through the regulated platform. Previously, HashKey’s trading services were limited to institutional and professional clients. The expansion reflects growing confidence in Hong Kong’s structured regulatory environment and signals increasing institutional-grade infrastructure for crypto adoption.
HashKey Group, the parent company, operates a local exchange division that previously participated in Hong Kong’s voluntary licensing framework alongside other platforms like OSL. Earlier this year, the group revealed plans to become a fully regulated exchange in Hong Kong, targeting a Q2 2025 launch—now realized with this licensing achievement.
👉 Discover how regulated crypto exchanges are shaping the future of digital finance.
Hong Kong’s Evolving Crypto Regulatory Framework
Hong Kong’s mandatory crypto licensing regime took effect on January 1, 2025, as part of a broader strategy to attract global investors and establish the city as a leading hub for digital asset innovation. Under the new rules, any platform offering virtual asset trading services to retail clients must obtain formal authorization from the SFC.
This regulatory shift encourages traditional financial institutions to form strategic partnerships with compliant crypto firms. Banks and fintech players are increasingly open to collaboration, fostering an ecosystem where innovation meets oversight.
Despite strict compliance requirements, major industry players—including HTX, OKX, and Amber Group—have established or expanded operations in Hong Kong. The city’s balanced approach—supporting innovation while enforcing investor protection—has drawn international attention.
One notable development came from Plutus VC, an innovation-focused venture fund, which announced the creation of the ProDigital Fund to back early-stage Web3 ventures aligned with Hong Kong’s policy direction. By March 2025, the fund had secured $30 million in commitments during its initial fundraising phase, with a goal of raising $100 million by year-end.
The ProDigital Future Fund will target Web3 startups at their growth stage, particularly those with ties to China and ambitions to scale across key markets such as Australia, Singapore, Europe, and the United States.
China Closes Crypto Doors, Opens Web3 Innovation Pathways
While Hong Kong embraces regulated crypto trading, mainland China maintains its strict ban on cryptocurrency activities. However, Beijing is actively promoting innovation in Web3 technologies, signaling a strategic pivot toward next-generation internet infrastructure.
In March 2025, the Beijing Municipal Science & Technology Commission and Zhongguancun Science Park Management Committee jointly released a white paper exploring the future of Web3 development during the Zhongguancun Forum. The document defines Web3 as the next evolutionary phase of the internet—centered on immersive 3D environments that blend real and virtual experiences through decentralized technologies.
The white paper outlines challenges and roadmaps for advancing blockchain, metaverse applications, and non-fungible tokens (NFTs). It emphasizes technological sovereignty and digital economy growth as national priorities.
Even global crypto leaders have acknowledged this shift. Binance CEO Changpeng Zhao commented on the timing of China’s move, calling it an “interesting development”_, while Tron founder Justin Sun praised the country’s _“forward-looking” approach to embracing transformative tech.
How Far Has Web3 Development Progressed?
The research categorizes Web3 into four foundational layers:
- Infrastructure Layer: Powered by blockchain, artificial intelligence (AI), and distributed computing.
- Interaction Terminal Layer: Includes XR (extended reality), AR/VR devices, and smart wearables enabling real-virtual interaction.
- Platform Tools Layer: Provides development frameworks, SDKs, and content engines for building digital worlds.
- Application Layer: Hosts consumer-facing services such as decentralized finance (DeFi), social platforms, gaming, and NFT marketplaces.
Beijing identifies generative AI, XR interaction terminals, and content creation platforms as critical innovation zones. Major tech giants—including Apple, Meta, Microsoft, Google, NVIDIA, Baidu, ByteDance, and Tencent—are recognized as key drivers shaping the global Web3 ecosystem.
👉 Explore how Web3 is redefining digital ownership and online identity.
Is China Competing for the Crypto Crown?
Though the U.S. leads in Web3 innovation and Europe prioritizes data privacy, countries like Japan and South Korea are aggressively pursuing leadership roles. Meanwhile, China is making quiet but significant strides through localized planning and policy support.
Over 30 provincial and municipal governments—including Beijing, Shanghai, Guangzhou, and Hangzhou—have introduced supportive policies for blockchain and Web3 development. With substantial capital flowing from wealthy domestic investors and favorable government backing, China could emerge as a dominant force in digital asset infrastructure—even without legalizing retail crypto trading.
Recent reports suggest that despite the domestic ban, China remains Binance’s largest market, highlighting persistent demand and underground adoption. This paradox underscores the complexity of regulating decentralized technologies in highly connected digital economies.
As Hong Kong builds a compliant gateway for global crypto flows, mainland China focuses on controlling the underlying technological stack—aiming not just to participate in Web3, but to help define its architecture.
👉 Learn how compliant platforms are bridging traditional finance with blockchain innovation.
Frequently Asked Questions (FAQ)
Q: What does HashKey’s new license allow?
A: HashKey has upgraded its Type 1 and Type 7 licenses under Hong Kong’s SFC framework, enabling it to legally offer retail cryptocurrency trading services for approved assets like Bitcoin and Ethereum.
Q: Is crypto trading legal in mainland China?
A: No. Cryptocurrency trading and issuance remain banned in mainland China. However, the government supports research and development in blockchain and Web3 technologies.
Q: How is Hong Kong different from mainland China on crypto regulation?
A: Hong Kong operates under a regulated framework allowing licensed platforms to serve retail investors. It aims to become a global crypto hub while ensuring investor protection—unlike mainland China’s outright ban.
Q: Which cryptocurrencies are available on HashKey Exchange?
A: Initially, retail users can trade major assets such as Bitcoin (BTC) and Ethereum (ETH), with potential expansions based on regulatory approvals.
Q: What is the ProDigital Fund?
A: A venture fund launched by Plutus VC to invest in early-growth Web3 startups aligned with Hong Kong’s digital asset policies. It aims to raise $100 million by end of 2025.
Q: Can foreigners use HashKey Exchange?
A: Yes. While based in Hong Kong, HashKey Exchange serves a global user base compliant with local regulations and KYC/AML requirements.
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