CMB International Securities Becomes First Mainland Broker to Offer Crypto Trading in Hong Kong

CMB International Securities (CMBI), the brokerage arm of China Merchants Bank, has secured a virtual asset license from the Securities and Futures Commission (SFC) in Hong Kong. This milestone allows CMBI to become the first mainland broker to offer cryptocurrency trading services in the region. The license enables CMBI to provide a range of services, including trading, custody, and advisory services. These services encompass investment strategies, risk management, and regulatory compliance.

Joshua Chu, a lawyer and co-chair of the Hong Kong Web3 Association, commented on the significance of this development. He noted that by obtaining this license, CMBI gains regulated access to Hong Kong’s dynamic crypto market. However, he also emphasized that the company must operate within strict boundaries that prevent direct mainland participation, reflecting the delicate balance between innovation and legal constraints.

This move by CMBI is part of a broader trend where mainland brokers with international operations are showing increased interest in gaining virtual asset licenses in Hong Kong. These brokers aim to attract global investors and leverage Hong Kong’s regulatory environment to offer comprehensive crypto services. Authorized mainland brokers can create omnibus accounts on Hong Kong’s eleven licensed crypto trading platforms. These accounts consolidate the assets of multiple clients into a single account, allowing users to access major coins and stablecoins.

Hong Kong has been actively working to advance its virtual asset plans and position itself as a global crypto hub. The region’s efforts are supported by mainland China, although the services offered by CMBI in Hong Kong remain forbidden on the mainland. In late June, the Financial Services and the Treasury Bureau (FSTB) and the SFC launched a joint public consultation on legislative proposals for establishing licensing regimes for digital asset dealing and custodian service providers. This consultation will last until August 29.

Secretary for FSTB Christopher Hui stated that the government is striving to build Hong Kong into a premier global hub for digital assets. The city’s novel stablecoin ordinance will take effect on August 1, when the Hong Kong Monetary Authority (HKMA) begins accepting formal applications. The government is currently processing license inquiries from more than 40 companies, indicating a high level of interest from major firms in the region.

Economist Hong Hao, a managing partner at Lotus Asset Management, predicted that the market value of stablecoins could surpass $1 trillion in the near term. He argued that stablecoins issued in Hong Kong may be more stable than those in the U.S., citing the city’s regulatory clarity and resource base. This prediction underscores the potential for Hong Kong to become a leading center for stablecoin issuance and trading.