The Securities and Futures Commission (SFC) of Hong Kong has officially released its quarterly report for the third quarter of 2025 (July to September). The report highlights a period of explosive growth in the digital asset sector, driven by increasing institutional participation and a maturing regulatory environment.
I. Virtual Asset Spot ETFs: Market Cap Rockets by 217%
The SFC report reveals that Hong Kong’s Virtual Asset (VA) Spot ETF market has reached a critical mass, becoming a primary gateway for regulated capital entering the crypto space.
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Significant Growth: As of September 30, 2025, the total market capitalization of VA spot ETFs climbed to US$920 million (approximately HK$7.17 billion), marking a staggering 217% increase since their initial launch.
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Expansion of Offerings: During the quarter, the SFC authorized three additional VA spot ETFs investing directly in Bitcoin and Ether, bringing the total number of such products in the market to nine.
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Institutional Adoption: The surge underscores the robust demand from institutional and retail investors for "regulated, custodial-grade" exposure to digital assets without the complexities of private key management.、
II. Tokenized Money Market Funds: AUM Surges 391%
Real-World Asset (RWA) tokenization has emerged as a major growth engine in Hong Kong’s financial landscape.
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Exponential Scaling: The Assets Under Management (AUM) for the five SFC-authorized tokenized money market funds (MMFs) reached HK$5.387 billion (approx. US$692 million), representing a massive 391% quarter-on-quarter rise.
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Mainstream Shift: The tokenization of fixed-income products, such as government bonds and commercial paper, is transforming traditional finance by providing higher liquidity and lowering transactional friction through on-chain transparency.
III. Policy Stimulus: Stamp Duty Exemption for Tokenized ETFs
In a move to bolster secondary market liquidity, the SFC confirmed a pivotal tax incentive for the tokenization sector:
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Transfer Tax Waiver: The SFC confirmed that the existing stamp duty exemption—previously reserved for traditional ETFs—officially applies to the transfer of tokenized ETF shares.
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Market Impact: By eliminating stamp duty costs, the SFC aims to lower barriers for secondary market trading. This measure is expected to attract more market makers, reduce slippage for large-scale transactions, and foster a more vibrant trading ecosystem for tokenized fixed-income and monetary products.
IV. Licensed Ecosystem: 11 Platforms Leading the Compliance Era
Hong Kong’s Virtual Asset Trading Platform (VATP) landscape is steadily expanding, providing a secure foundation for the growing ETF and tokenization markets.
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Current Standings: As of the end of September 2025, the SFC has officially granted licenses to 11 virtual asset trading platforms.
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Upcoming Cohort: The regulator noted that eight additional applications are currently under review, indicating sustained interest from global players looking to operate within Hong Kong’s rigorous regulatory framework.
V. 2026 Outlook: The Golden Age of Tokenized Finance
The Q3 2025 report serves as a harbinger of the financial digitalization trend expected in 2026.
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Product Diversification: Building on the success of spot ETFs, the market expects a wider array of tokenized products linked to commodities, real estate, and high-yield corporate bonds in the coming year.
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Global Liquidity Hub: The combination of stamp duty waivers and an increasing number of licensed platforms positions Hong Kong as a premier global hub for secondary market liquidity in tokenized assets.
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Institutional Integration: With AUM growing at an exponential rate, tokenized products are transitioning from "experimental pilots" to essential components of traditional institutional portfolios.
Conclusion: Through a combination of clear regulatory roadmaps and tangible price incentives (such as tax waivers), Hong Kong is successfully transitioning from a crypto-trading pilot to a global powerhouse for tokenized finance. The SFC's latest data confirms that the infrastructure for a large-scale, tokenized economy is now firmly in place.