Hong Kong is advancing its efforts to become a leading center for digital assets by proposing the legalization of Bitcoin and cryptocurrency derivatives. The initiative includes plans to approve Bitcoin futures and options trading for professional investors, aiming to diversify the market while maintaining robust risk controls.

Christopher Hui, Secretary for Financial Services and the Treasury, highlighted that the introduction of Bitcoin and Ethereum ETFs has broadened Hong Kong's market offerings, reinforcing its status as Asia's premier ETF market. The proposed derivatives framework is part of a comprehensive strategy to enhance Hong Kong's competitiveness in the digital asset sector.

The Securities and Futures Commission (SFC) emphasized the importance of implementing stringent risk management measures to ensure that trades are conducted in an orderly, transparent, and secure manner. Initially, these derivatives will be available exclusively to professional investors—those with over HK$8 million (approximately US$1 million) in investable assets. 

This move complements Hong Kong's recent initiatives, including the approval of Asia's first spot Bitcoin and Ethereum ETFs in April 2024, the introduction of staking services under controlled conditions in April 2025, and the passage of a Stablecoin Bill in May 2025, establishing a licensing regime for stablecoin issuers. Collectively, these efforts aim to create a robust…