Hong Kong Reappoints Leung to Balance Crypto Innovation with Investor Safeguards

Hong Kong's Securities and Futures Commission (SFC) has announced the reappointment of Julia Leung as its chief executive for a three-year term, effective from December 2025. The decision underscores the city's commitment to strengthening its regulatory framework for digital assets and solidifying its position as a global hub for innovation in financial markets. Leung, who assumed the role in 2023, has spearheaded initiatives to modernize Hong Kong's financial infrastructure, including expanding oversight of virtual assets and enhancing investor protection.

The SFC's renewed focus on crypto regulation is evident in its recent policy updates. In August 2025, the regulator introduced revised guidelines for virtual asset trading platforms, mandating stricter asset segregation and cybersecurity protocols to mitigate risks following global exchange failures. Concurrently, the Hong Kong Monetary Authority (HKMA) implemented a licensing regime for fiat-backed stablecoins, requiring all issuers to obtain licenses by October 31, 2025, or cease operations in the region. This move aligns with the SFC's broader strategy to balance innovation with stability, particularly as the global stablecoin market surpasses $250 billion.

Leung's leadership has also prioritized fostering innovation while maintaining investor safeguards. The SFC's ASPIRe roadmap, part of Hong Kong's Policy Statement 2.0 on digital assets, emphasizes accessibility, product protection, and infrastructure development. In September 2025, the regulator permitted licensed intermediaries to offer staking services through segregated accounts, a policy designed to accommodate institutional demand while ensuring compliance. Additionally, the SFC has funded tokenization projects, approving 11 digital asset trading platforms by July 2025 and facilitating three tokenized money market funds that managed over $700 million by March 2025.

Hong Kong's regulatory approach contrasts with the U.S.'s GENIUS Act, which imposes stringent compliance requirements on stablecoin issuers, favoring large players and consolidating dollar dominance. By contrast, Hong Kong's Stablecoins Ordinance allows issuers to peg tokens to any official currency, including the offshore RMB, while requiring a minimum capital of HKD 25 million. This flexibility positions the region to attract cross-border transactions and support the Belt and Road Initiative (BRI), where stablecoins could reduce trade costs in Global South economies.

Leung's reappointment signals continuity in Hong Kong's dual strategy of innovation and oversight. The SFC's proactive measures, including enhanced stablecoin regulations and tokenization projects, reflect its ambition to compete with jurisdictions like Singapore and the UAE while aligning with China's broader financial goals. As global digital markets evolve, Hong Kong's regulatory framework under Leung's leadership aims to mitigate risks, attract institutional capital, and reinforce the city's status as a trusted financial center.