On June 24, 2025, Guotai Junan International, a Hong Kong-listed subsidiary of the Chinese brokerage Guotai Junan Securities, received approval from the Hong Kong Securities and Futures Commission (SFC) to offer virtual asset trading services. This regulatory milestone marks the first time a mainland Chinese brokerage has secured such a license in Hong Kong, enabling the firm to facilitate trading in major cryptocurrencies like Bitcoin, Ethereum, and stablecoins such as Tether. The announcement triggered a dramatic market response, with Guotai Junan International’s share price soaring 375% over three trading days, rising from HKD 1.24 on June 24 to HKD 4.66 on June 26, boosting the company’s market value to $5.3 billion.
A Historic Approval for Hong Kong’s Crypto Ambitions
The SFC’s decision to grant Guotai Junan Securities an upgraded Type 1 license reflects Hong Kong’s broader push to establish itself as a global hub for digital assets. The license allows the brokerage to provide trading and advisory services for virtual assets through omnibus accounts with SFC-licensed platforms, positioning it to tap into the region’s growing cryptocurrency market. This development comes as Hong Kong continues to refine its regulatory framework for digital assets, with the Stablecoins Ordinance set to take effect on August 1, 2025, establishing comprehensive rules for fiat-referenced stablecoins.
Guotai Junan International’s approval is a significant step in bridging traditional finance with the digital asset ecosystem. The firm, backed by Shanghai’s state-owned enterprise vehicle through its parent company, Guotai Haitong Group, is the first Chinese mainland brokerage to gain this level of access in Hong Kong. The license enables clients to trade major cryptocurrencies directly on the firm’s platform, a move that aligns with Hong Kong’s efforts to foster regulated crypto growth while mainland China maintains a ban on crypto trading and mining.
Market Reaction and Broader Implications
The market’s response to the news was swift and pronounced. Guotai Junan International’s shares surged over 120% on June 24 alone, reaching HKD 2.7, and continued to climb, peaking at HKD 4.66 by June 26. This rally reflects strong investor confidence in the firm’s ability to capitalize on Hong Kong’s evolving crypto landscape. Other regional players, such as OSL, a licensed crypto exchange, also saw gains, with its share price rising 18% to HKD 14.6 on June 25, marking a one-year high.
The approval has sparked speculation about a potential “crypto-stock boom” in Hong Kong, as other Chinese brokerages, including China Merchants Securities and Huatai International, pursue similar license upgrades. According to a report from the state-owned Securities Times on June 26, these firms are actively seeking to expand their crypto-related offerings, signaling a competitive race to capture market share in Hong Kong’s digital asset sector.
Hong Kong’s Regulatory Framework Drives Growth
Hong Kong’s progressive stance on cryptocurrency regulation stands in contrast to mainland China’s restrictive policies. The SFC has implemented a dual licensing regime under the Securities and Futures Ordinance and the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, ensuring robust oversight of virtual asset trading platforms (VATPs). The approval of Guotai Junan’s license underscores the city’s commitment to creating a regulated environment that attracts both institutional and retail investors.
The upcoming Stablecoins Ordinance, effective August 1, 2025, will further strengthen Hong Kong’s regulatory framework by requiring licenses from the Hong Kong Monetary Authority (HKMA) for fiat-pegged stablecoin issuers. This move is expected to enhance market stability and investor trust, potentially drawing more traditional financial institutions into the digital asset space.
Challenges and Opportunities Ahead
While the license approval positions Guotai Junan International as a pioneer in Hong Kong’s crypto market, challenges remain. The firm must navigate a complex regulatory landscape, ensuring compliance with SFC requirements for risk disclosures and custodial responsibilities. Additionally, the volatility of cryptocurrencies poses risks for both the brokerage and its clients, particularly in a market driven by rapid price movements.
However, the opportunities are substantial. Hong Kong’s crypto-friendly policies have already attracted global attention, with platforms like OSL and HashKey benefiting from increased investor confidence. The SFC’s approval of crypto derivatives trading for professional investors, announced earlier in June 2025, further expands the scope of digital asset offerings in the region. This regulatory clarity could position Hong Kong as a testing ground for innovative financial products, such as yuan-backed stablecoins, as suggested by a Morgan Stanley report on June 25, 2025.
Broader Market Context
The approval comes amid a bullish period for cryptocurrencies, with Bitcoin surpassing 108,000 USDT on June 26, 2025, reflecting a 1.45% increase in 24 hours. This surge aligns with global regulatory advancements, including significant initiatives in the U.S. and Hong Kong. However, not all regional markets are experiencing similar growth. On June 26, some Hong Kong brokerage stocks, including Guotai Junan International, saw a slight decline, with the firm’s shares dropping over 7% as the initial rally cooled. This volatility highlights the speculative nature of crypto-related investments and the need for cautious optimism.
Singapore’s recent crackdown on unlicensed crypto exchanges, effective June 30, 2025, may further drive market activity to Hong Kong. The Monetary Authority of Singapore (MAS) has mandated that all digital token service providers serving overseas clients obtain a license or cease operations, potentially pushing firms to jurisdictions with clearer regulatory frameworks like Hong Kong.
What Lies Ahead for Guotai Junan and Hong Kong?
Guotai Junan International’s entry into crypto trading marks a pivotal moment for both the firm and Hong Kong’s financial ecosystem. As the first mainland Chinese brokerage to secure such a license, it sets a precedent for others to follow, potentially reshaping the role of brokerages from traditional trade facilitators to hubs for digital asset innovation. The firm’s ability to offer trading in Bitcoin, Ethereum, and stablecoins, alongside advisory services, positions it to attract a diverse client base, from institutional investors to retail traders.
The broader implications for Hong Kong are equally significant. The city’s efforts to establish itself as a global digital asset hub are gaining traction, supported by a robust regulatory framework and growing investor interest. As more brokerages seek SFC approval, competition in the crypto trading space is likely to intensify, driving innovation and market growth.
What does this mean for the future of crypto in Hong Kong? Can the city maintain its edge as a regulated digital asset hub while balancing the risks of a volatile market? As Guotai Junan International and its peers navigate this new terrain, the answers to these questions will shape the trajectory of Hong Kong’s financial landscape.
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