Hong Kong’s Securities and Futures Commission (SFC) and the Accounting and Financial Reporting Council (AFRC) have agreed to a new memorandum of understanding (MoU) to enhance regulatory oversight of cryptocurrency firms, extending their collaboration to include financial reporting, audits, and compliance. The agreement replaces a 2021 MoU between the SFC and the Financial Reporting Council, which was renamed the AFRC in 2022, and introduces frameworks for information sharing and joint inspections.
The expanded MoU applies to SFC-licensed virtual asset service providers, licensed corporations, registered open-ended fund companies, and authorized funds, marking a broader regulatory scope for crypto-related entities. The deal follows plans outlined in January of an unspecified year to introduce new crypto rules, reflecting Hong Kong’s evolving approach to digital asset governance.
Kelvin Wong, chair of the SFC, described the updated cooperation as providing “more comprehensive oversight” across a wider range of financial sector activities. The agreement underscores efforts to align accounting and regulatory standards with the growing prominence of cryptocurrency in Hong Kong’s financial ecosystem.
The MoU is expected to facilitate closer coordination between regulators and industry participants, ensuring adherence to financial reporting requirements and mitigating risks associated with virtual assets. It also signals a shift toward more structured regulatory engagement as the crypto sector matures.
Written by Steven Cook
Regulation Desk
