Hong Kong Tightens Crypto Custody Rules Amid Cybersecurity Concerns

Hong Kong has introduced stricter requirements for cryptocurrency platforms, prohibiting the use of smart contracts in cold wallets and mandating 24/7 monitoring to address escalating cybersecurity threats that have cost investors billions globally. The Securities and Futures Commission (SFC) issued updated guidelines, requiring real-time reconciliation of client assets, whitelisted withdrawal addresses, and enhanced security protocols for all licensed platforms operating in the territory. These new rules aim to prevent asset losses and bolster investor protection amidst a global push for greater digital asset security.