Hong Kong to Allow Institutional Crypto Perpetual Futures Under New Rules

TheNewsCryptoPublished on 2026-02-11Last updated on 2026-02-11

Abstract

Hong Kong's Securities and Futures Commission (SFC) is set to introduce a new regulatory framework allowing licensed trading platforms to offer cryptocurrency perpetual futures contracts. Initially limited to institutional investors, these contracts enable traders to speculate on crypto prices without an expiry date. Platforms must demonstrate robust risk management and disclosure practices. Brokers will be permitted to use Bitcoin and Ethereum as collateral for client financing, subject to strict credit standards. The SFC is also implementing measures to prevent conflicts of interest, requiring exchanges to separate market-making activities into independent units. This cautious, step-by-step approach aims to balance innovation with credibility, attract global institutions, and enhance liquidity while prioritizing transparency and risk management.

Hong Kong is planning to become a leading regulated hub for digital assets. Julia Leung, SFC Chief Executive, speaking at CoinDesk, says that the watchdog will soon publish a high-level regulatory framework that allows licensed trading platforms to offer perpetual futures contracts tied to cryptocurrencies.

Initially limited to institutional investors

Under the upcoming framework, perpetual futures allow traders to speculate on prices without an expiry date. Leung says that initially, it will be allowed only for institutional investors, and platforms must prove they can manage and disclose the risk properly. SFC will remain focused on the fair market rules for the customers.

On the other hand, regulators will allow brokers to finance the clients using selected digital assets as collateral. As the crypto markets have high volatility, the eligibility starts only with Bitcoin and Ethereum. Borrowers must meet strict credit standards. The regulators are moving cautiously with the most stable and established tokens.

SFC is also refining the exchanges that want to run market-making operations; they must separate those activities into independent units and maintain clear conflict of interest controls. This is aimed at preventing exchanges that might see the users’ trading activity and can use that information to make money.

Reason behind this move

The SFC is trying to balance innovation and credibility. The official wants more sophisticated products and greater participation from global institutions. Instead of approving everything at once, the regulators are widening the access step by step.

If this move has been implemented, then Hong Kong could attract hedge funds and trading firms that rely on perpetuals and will increase liquidity in local regulated venues. But the regulator’s goal is clear: that innovations will be welcomed within a framework that prioritizes transparency and risk management.

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TagsCryptoCryptocurrencyHong Kong

Related Questions

QWhat new type of cryptocurrency product will Hong Kong allow under its upcoming regulatory framework?

AHong Kong will allow licensed trading platforms to offer perpetual futures contracts tied to cryptocurrencies.

QWho will be permitted to trade these crypto perpetual futures initially?

AInitially, trading will be allowed only for institutional investors.

QWhich two cryptocurrencies are eligible to be used as collateral for client financing under the new rules?

ABitcoin and Ethereum are the eligible cryptocurrencies that can be used as collateral.

QWhat is one of the key requirements for exchanges that want to run market-making operations?

AThey must separate their market-making activities into independent units and maintain clear conflict of interest controls.

QWhat is the primary goal of the SFC in implementing these new regulations, according to the article?

AThe SFC is trying to balance innovation and credibility, welcoming innovations within a framework that prioritizes transparency and risk management.

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