Hong Kong Tightens Crypto Custody Rules to Enhance Investor Protection

The Hong Kong Securities and Futures Commission (SFC) has introduced new regulations for crypto custody, bolstering oversight of digital asset trading platforms in the region. These updates aim to establish a more secure environment within Hong Kong’s push toward becoming a global crypto hub. 🎧 Exchanges must now segregate customer assets from their own holdings, a crucial step to prevent commingling and safeguard investor capital. The SFC has also mandated enhanced protection for private keys through multi-layered security measures, regular audits, and defined internal controls. Failure to comply with these requirements could result in license revocation or suspension.