According to Aastocks, Futu Securities announced that it has received approval from the Hong Kong Securities and Futures Commission for the upgrade of License No. 1 (Securities Trading) services. The company will roll out virtual asset trading financing services to eligible clients in Hong Kong. It is understood that the collateral for this service must be traditional securities. Previously, credit limits obtained through traditional securities financing (margin) could not be used for cryptocurrency trading, but this has now been relaxed to allow their use for cryptocurrency trading.

As for using virtual assets directly as collateral for “margin” trading, although a circular published by the Hong Kong Securities and Futures Commission in February relaxed the use of virtual assets as collateral, the circular also stated that, before revisions to capital regulations, virtual asset collateral would be subject to a 100% haircut under the Securities and Futures (Financial Resources) Rules. It is expected that this will present certain challenges to the industry’s capital efficiency in actual operations.