The licensing of virtual asset trading continues to ripple across financial markets, shifting focus from Hong Kong-listed Guotai Junan International to A-share player Tianfeng Securities. Wind data shows Tianfeng Securities surged 7.89% on June 27, briefly hitting the daily limit-up.
Breaking Ground: Guotai Junan International’s License Upgrade
Guotai Junan International recently announced its upgraded license from Hong Kong’s Securities and Futures Commission (SFC), now permitting:
– Direct trading of cryptocurrencies (Bitcoin, Ethereum)
– Stablecoin transactions (e.g., USDT)
– Advisory services for virtual assets
– Issuance of virtual asset-linked derivatives
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Strategic Implications
Analysts highlight three transformational impacts:
1. Revenue Diversification: New income streams from trading commissions, stablecoin settlement fees, and structured products.
2. Regulatory Leadership: First-mover advantage in Hong Kong’s push to become a virtual asset hub.
3. Industry Catalyst: Pressure on peers to accelerate cross-border digital infrastructure development.
Hong Kong’s Regulatory Roadmap
The SFC’s 2025 “A-S-P-I-Re” framework simplifies market entry while emphasizing:
– Licensed platforms for investor protection
– Compliance optimization
– Progressive integration of traditional and digital finance
“This upgrade transitions brokers from securities specialists to multiproduct digital asset gateways,” notes Sun Ting, Dongwu Securities’ analyst.
Brokerage Arms Race Intensifies
As of June 2025, 41 institutions hold upgraded Type 1 licenses, including:
| Brokerage | Key Developments |
|———–|——————|
| Guotai Junan International | Launched VA spot ETF derivatives in 2024 |
| Futu Securities | Enabled BTC/USD trading pairs since 2024 |
| Tianfeng International | Among earliest A-share affiliates to upgrade |
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Emerging Trends
- Tokenization: Guotai Junan’s digital bond issuance in 2025
- Cross-border Synergy: Stablecoin adoption for international settlements
- Investor Demand: 78% surge in VA-related discussions on Futu’s platform (2025 data)
FAQs: Virtual Assets in Brokerage Services
Q: How does this affect traditional investors?
A: Licensed brokers now offer regulated access to crypto alongside stocks, creating unified portfolios.
Q: What risks should investors note?
A: Only trade on SFC-licensed platforms—unregulated exchanges lack investor protections.
Q: Will more A-share brokerages enter this space?
A: Analysts expect 60% of Hong Kong-based Chinese brokerages to upgrade licenses by 2026.
Q: How do stablecoins fit into brokerage services?
A: They enable faster cross-border settlements, potentially reducing reliance on SWIFT.
Sector Outlook: Three Growth Vectors
- Revenue Mix Shift: Virtual assets may contribute 15-20% to top brokers’ overseas income by 2027.
- Valuation Reset: Firms with digital asset capabilities trade at 30% P/E premium (East China Securities data).
- Ecosystem Buildout: Partnerships between brokers, custodians, and blockchain developers accelerating.
“The real game-changer is asset tokenization—imagine trading tokenized Tesla stocks 24/7,” suggests Tao Shengyu, Donghai Securities analyst.
Conclusion
As regulatory clarity improves, virtual asset services are becoming table stakes for brokerages targeting international clients. While compliance remains paramount, early adopters like Guotai Junan International demonstrate how digital assets can drive:
– Higher-margin businesses
– Competitive differentiation
– Long-term valuation re-rating
The next 24 months will likely see intensified competition as mid-tier brokers scramble to catch up in this USD 9 trillion opportunity space.
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