HK gets world-first secondary tokenised funds trading

The Securities and Futures Commission has approved the world's first secondary trading of tokenised public funds on its licensed virtual asset trading platform (VATP), with around-the-clock trading of two tokenised money market funds beginning on Monday. The approval builds on a new regulatory framework it introduced in April, which sets out requirements for secondary trading of tokenised funds on licensed VATPs. The framework covers trading channel operations, fair pricing, liquidity provision and disclosure. The first batch of products involves two existing SFC-authorised tokenised money market funds, now available for secondary trading on a 24/7 basis. Looking ahead, the SFC said tokenised public funds could further leverage tokenised deposit capabilities being developed in collaboration with the Hong Kong Monetary Authority under Project Ensemble. This would allow investors to sell tokenised assets around the clock and instantly transfer proceeds to other investment opportunities. Elisa Ng, the SFC's executive director of investment products, said the move "marks an important milestone" in the city's digital asset development, adding that it adds "24/7 trading capability" to Hong Kong's evolving tokenisation ecosystem. The SFC said it would monitor trading activities closely and consider broadening the product scope over time, taking into account market developments and experience gained. Edited by Tony Sabine