Decentralized finance (DeFi) projects could be subject to licensing requirements and regulation, a Hong Kong regulator said on Wednesday. Keith Choy, interim head of intermediaries at Hong Kong’s Securities and Futures Commission (SFC), said that as long as DeFi activity falls within the scope of the Securities and Futures Ordinance (SFO) it will be subject to the same regulatory requirements as traditional financial activity. Choy made the comments during a speech at the Web3 Festival in Hong Kong as the U.S. and France also published reports on DeFi regulation recently. The SFC had previously highlighted DeFi as an area in need of regulation but had not laid out its stance. “Providing automated trading services is a regulated activity under the SFO,” Choy said. “If a decentralized platform allows trading in virtual assets, which constitutes securities or futures as defined under the SFO, the platform and operators are required to have a Type 7 license,” he added. Offering a collective investment scheme to the public in Hong Kong is subject to authorization requirements.
Hong Kong Regulator Says DeFi Projects Could Face Regulatory Requirements
