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Author: Zhang Feng
With the rapid development of the global digital asset industry, compliance and institutionalization have become the main theme of industry evolution.Against this background, HashKey, Asia’s leading digital asset financial services group, has passed the hearing of the Hong Kong Stock Exchange and will become “the first crypto-asset stock in Hong Kong.”Its prospectus reveals a unique path to exploring capital market connections under a strict regulatory framework.The listing of HashKey is not only a milestone for the company itself, but also can be regarded as a key case for observing the integration process of the digital asset industry and the traditional financial regulatory system.
We combined the information disclosed in HashKey’s prospectus to conduct an in-depth analysis of the dual regulatory environment it faces——It must not only comply with the special rules of the Securities and Futures Commission of Hong Kong (SFC) as a licensed virtual asset trading platform, but also meet the general requirements of the Listing Rules of The Stock Exchange of Hong Kong Limited (the Stock Exchange) as an issuer.At the same time, it will further compare the similarities and differences between its listing process and traditional financial companies (such as securities firms and banks), focus on the legal characterization of virtual assets in accounting and disclosure, and analyze the substantial impact of the key qualification of “licensed status” on listing review.
1. HashKey business outline and regulatory overview
According to the prospectus, HashKey Group is positioned as “Asia’s largest digital asset management service provider” and “Asia’s largest digital asset on-chain service provider.”Its business territory spans three core sectors:
The first is digital asset transaction facilitation services,Provide virtual asset trading, custody and related services through a licensed platform.
The second is services on the digital asset chain.Including staking and asset tokenization services.
The third is digital asset management services.Provide professional digital asset portfolio management for institutions and qualified investors.
Supporting this global business layout is an extremely complex and dynamically evolving regulatory network.The prospectus details at considerable length the legal framework applicable in each of its major locations of operation:
Hong KongAs its headquarters and core operating location, HashKey’s business is mainly regulated by the Securities and Futures Ordinance (SFO) and the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO).Its Hong Kong entity holds Type 1 (securities dealing), Type 7 (provision of automated trading services) and Type 9 (asset management) regulated activity licenses issued by the Securities and Futures Commission, and operates a virtual asset trading platform (VATP) licensed under AMLO.
singapore,The provision of fund management and digital payment token (DPT) services through licensed companies is regulated by the Monetary Authority of Singapore (MAS) and subject to the Securities and Futures Act (SFA) and the Payment Services Act (PS Act) respectively.
other jurisdictions,It holds a digital asset business (Class F) license in Bermuda, a virtual asset service provider (VASP) license in Dubai, UAE, is registered as a cryptocurrency trading service provider in Japan, is registered as a VASP in Ireland and is applying for cryptoasset service provider (CASP) authorization.
This multi-jurisdictional licensing status is not only a reflection of its strength and compliance commitment, but also requires its listing process to meet the requirements of multiple regulatory systems at the same time, of which Hong Kong’s dual supervision is the most core and typical.
2. Analysis of the listing mechanism under the dual regulatory framework
HashKey’s road to Hong Kong listing is essentiallySecurities and Futures Commission (SFC) regulatory framework for virtual asset service providerswithIssuer listing regulatory framework on the Stock Exchange (HKEX)Find points of intersection.
(1) Ongoing compliance obligations of licensed VATPs (SFC dimension)
As a licensed VATP, HashKey (represented by entities such as Hash Blockchain Limited) must continue to comply with a series of strict regulations, which form the bottom line of its business operations and are also the starting point for listing review:
Financial resource requirements.Must maintain an issued share capital of no less than HK$5 million, and a “working capital” requirement of at least HK$3 million or calculated based on a complex formula.In addition, they must hold liquid assets in Hong Kong that are sufficient to cover 12 months of operating expenses.
Custody of Client Assets.Client assets must be held in trust form through a wholly-owned subsidiary “associated entity” incorporated in Hong Kong, and asset segregation is strictly enforced.At least 98% of customer virtual assets must be stored in cold wallets, and insurance or compensation arrangements must be established.
Internal Control and Governance.It is necessary to establish a complete risk management, compliance, information technology and anti-money laundering/terrorist financing (AML/CFT) system, and appoint responsible officers (ROs) and core functional managers (MICs) who meet the requirements.
Code of Conduct.You must comply with documents such as the “Guidelines for Virtual Asset Trading Platform Operators” to ensure honest and fair business operations, fully disclose risks, and avoid conflicts of interest.
These ongoing obligations mean that the compliance status of HashKey’s listed entities and its key operating subsidiaries will be subject to ongoing direct supervision by the China Securities Regulatory Commission.Any major violation may result in the suspension or revocation of the license, which will fundamentally undermine its listing qualifications and ability to continue operating.
(2) Disclosure and compliance review of listing applicants (Stock Exchange dimension)
The Exchange’s review of issuers focuses on investor protection and market integrity.For issuers in special industries such as HashKey, the review will focus on them.
Business sustainability.Assess its ability to continue operating in a stringent and rapidly changing regulatory environment.This includes analyzing the stability of its license, its ability to cope with new regulations (such as Hong Kong’s new OTC derivatives reporting regulations to be implemented in 2025), and its compliance records in different jurisdictions.
Adequacy of risk disclosures.The prospectus must disclose in detail the unique risks associated with the digital asset business, such as extreme volatility in virtual asset prices, network security risks, custody risks, regulatory policy uncertainty, and potential technology obsolescence risks.The depth and breadth of disclosure will far exceed that of traditional companies.
Related party transactions and corporate governance.Since the group involves multiple licensed entities and complex flows of funds and client assets, the Stock Exchange will strictly review the fairness, necessity and compliance of its related party transaction arrangements to ensure compliance with the Listing Rules and the requirements of the Securities and Futures Commission.
Presentation of financial condition.The rationality and consistency of virtual asset-related accounting treatments, asset valuations, and revenue recognition methods (such as transaction fees, pledge income, and asset management fees) will become the focus of financial review.
(3) Interweaving and synergy of dual frameworks
Dual supervision is not separation.During the review, the Exchange will highly rely on and respect the SFC’s judgment in its professional field (i.e. the regulation of virtual asset services).For example:
Licensed status itself is a key positive factor in the Exchange’s assessment of an issuer’s compliance history and reputation.
The SFC’s past inspection results, disciplinary records or guidelines issued will become important references for the Exchange’s review.
The Exchange is likely to seek or adopt the SFC’s views on fundamental issues involving the legality of virtual asset business models.
Therefore, the listing mechanism of HashKey is presented as“Licensing and compliance are the foundation, and listing disclosure is the deepening”superposition model.The former is led by SFC to ensure the legality and soundness of business operations; the latter is led by HKEX to ensure the transparency and fairness of information in the capital market.The two together form a double line of defense for investor protection.
3. Comparative analysis with the listing process of traditional financial companies
Compared with the listing of traditional financial companies such as securities firms and banks, HashKey’s path is similar in process framework, but faces unique challenges in the substance of the review.
(1) Similarities
First, the core regulatory logic is consistent.The core goals are to protect investors and maintain market integrity.The second isComprehensive review requirements,All are required to meet a comprehensive review of historical records, corporate governance, financial status, related transactions, risk disclosure, etc.The third isLicensed operation is a prerequisite.Traditional securities firms need to be licensed, and HashKey as a VATP also needs to be licensed. The license status is an important prerequisite for business legitimacy and review.
(2) Significant differences
First, the maturity and stability of the regulatory system,The regulatory framework of traditional finance (such as the SFO rules for securities firms) has developed over decades and has become relatively mature and stable.However, virtual asset supervision (such as the SFC’s VATP Guidelines) is still in a period of rapid construction and iteration (such as the continuous introduction of multiple new guidelines in 2023, 2024, and 2025), and policy uncertainty is higher, resulting in a significant increase in issuers’ compliance costs and future uncertainty.
Second, the legal characterization of assets and products is unclear.This is the most fundamental difference.The legal attributes, accounting treatment, and transaction settlement rules for financial instruments such as stocks and bonds handled by traditional financial institutions have been clarified.Whether virtual assets constitute “securities” or “financial products” depends on their specific economic substance, and there is a gray area.The prospectus also mentioned that the nature of tokens may change over time, so HashKey chose to apply for dual licenses under SFO and AMLO at the same time to cover risks.This qualitative ambiguity directly affects how to classify, measure and disclose these assets in financial statements, and also affects the legal characterization of related business income.
The third is the particularity of the risk spectrum.HashKey needs to additionally disclose a series of unique risks that are rare in the traditional financial industry, such as: irreversible asset losses caused by loss or theft of private keys, protocol risks in the underlying blockchain network, smart contract vulnerability risks, stable currency failure risks, and complex risks arising from interaction with decentralized finance (DeFi).These risks are highly technical and challenge the understanding of auditors and investors alike.
The fourth is the challenge of valuation and profit model.The valuation of traditional financial institutions has relatively mature models (such as price-to-earnings ratio, price-to-book ratio, asset management scale multiple).The valuation of digital asset service companies is more complex. Its value is highly correlated with transaction volume, custody asset scale, market volatility, and regulatory access barriers. Moreover, profits may be affected by dramatic fluctuations in token prices, making future cash flow predictions more difficult.
4. The core impact of “licensed status” on listing review
“Licensed status” is the key to understanding HashKey’s listing review, and its impact is comprehensive and decisive.
(1) As a prerequisite and core advantage
Not absolutely prerequisite, but essentially necessary.Theoretically, an unlicensed digital asset company can also apply for listing, but the legality and sustainability of its business model will be fatally questioned and it will be extremely difficult to pass the review.For HashKey, its comprehensive licensing status (especially in the core market of Hong Kong) is the strongest evidence that its business is legal, its operations are compliant, and it has long-term viability. It forms an important part of its core competitiveness and value proposition in its listing application.
A manifestation of high barriers to entry.The “Industry Overview” section of the prospectus emphasizes that licenses and compliance are “significant barriers to entry” in the digital asset trading service market.HashKey’s licensed status is an intuitive reflection that it has crossed this threshold and has a strong moat, which can enhance investors’ confidence in its market position and profitability sustainability.
(2) License holding is the focus of continuous review
During the review, the Exchange will take an in-depth look at the “quality” of its licensing status:
Compliance History.Is there a record of investigations, penalties, warnings or additional conditions being imposed by the SFC, MAS or other regulatory authorities?The prospectus must disclose truthfully.A clean compliance history is a major plus.
Continued validity of license plate.The audit will focus on the measures taken by the company to ensure license renewal and respond to new regulations.For example, HashKey’s MPI license in Singapore and its transition to CASP in Ireland both demonstrate its ability to proactively adapt to regulation.
Reliability of internal controls.The strict internal control system (such as AML/CFT, network security, customer asset protection) spawned by licensing requirements is an important basis for the Stock Exchange to evaluate the effectiveness of its corporate governance and risk management and control.
Regulatory dependence risks.Reviews will also look at a company’s reliance on a specific regulatory environment or individual licences.HashKey’s business spans many countries, which to a certain extent diversifies the risk of policy changes in a single jurisdiction. This is its advantage.
(3) The relationship between licensing status and valuation
In valuation discussions, licensed status bringsregulatory premiumandtrust premiumwill be considered by the market.Being licensed means that it can legally serve a wider customer base (especially institutional investors and retail investors) and has greater room for business growth; it also means lower risks of regulatory uncertainty and stronger customer trust, which may lead to higher valuation multiples than unlicensed peers.
HashKey’s IPO journey outlines a unique path to market that carefully balances innovation and regulation, tradition and cutting-edge.The key to its success is successfully building and demonstrating a“Double Compliance”Solid framework: On the one hand, as a virtual asset service provider, it is deeply embedded in the increasingly strict functional regulatory system represented by the SFC, and responds to business risks with multiple licenses and continuous compliance; on the other hand, as a listing applicant, it actively embraces the information disclosure-based market regulatory system with the Stock Exchange’s “Listing Rules” as the core, and responds to investors’ perceived risks with transparent and detailed disclosures.
The particularity of this path is that it does not simply follow an existing template, but explores areas where there is no fully mature precedent.It profoundly reveals that in the process of the digital asset industry moving towards the mainstream financial system, “licensing” is the starting point for compliance, while “listing” is a higher stage of transparent and standardized development.Although licensing qualifications are not an absolute legal prerequisite for listing, they have become an indispensable “birth certificate” and “health certificate” for measuring the quality of a company and evaluating investment risks.
The case of HashKey shows that if digital asset companies want to enter the mainstream capital market in the future, they must elevate regulatory compliance to the core of their strategy, establish an internal control and governance system that goes beyond the minimum requirements, and be prepared to disclose business and risk information to the highest standards.Its listing process and subsequent performance are not only related to the company’s own destiny, but will also set a benchmark for the entire industry, influence the subsequent evolution of regulatory policies, and provide valuable reference for other markets around the world.
