Hong Kong virtual asset OTC transaction custody services are planned to be mainly supervised by the Securities Supervision Commission rather than the customs

Last year, when the Hong Kong Finance and Treasury Bureau consulted the public on virtual assets over the counter (OTC), it proposed that the Commissioner of Customs and Excise be licensed and the customs regulate the OTC services of virtual assets. Xu Zhengyu, the Secretary for Finance and Treasury of Hong Kong, explained that after proposing to submit OTC to customs regulation, some Legislative Council members raised different opinions, including concerns about regulatory arbitrage. Later, it was found that the market operation model was more complicated than originally imagined. Some OTC institutions not only operate OTC services but also conduct custody services. Therefore, they hope to centrally supervise related transactions. Now the Hong Kong Securities Supervision Commission is designated as the main regulator. If the (service) involves the part of the bank, the HKMA will be the front-line supervisor.
Xu Zhengyu also added that regardless of whether the virtual asset service provider will eventually be deemed to have been licensed, sufficient expectations will be given to ensure that there are sufficient regulatory and other resources to process the license application.