The Hong Kong financial landscape is undergoing a transformative shift as traditional finance meets digital innovation. On June 24, Guotai Junan International Holdings Limited made history by becoming the first mainland-backed securities firm in Hong Kong approved to offer comprehensive virtual asset trading services. This milestone marks a pivotal moment in the convergence of conventional financial institutions and the rapidly growing crypto ecosystem.
Clients can now directly trade major cryptocurrencies such as Bitcoin and Ethereum, along with stablecoins like Tether (USDT), through Guotai Junan International’s regulated platform. The announcement sent shockwaves across capital markets—its stock surged nearly 200% intraday, closing up 198%, the highest level in a decade. The momentum spilled over to other financial stocks, with multiple Hong Kong-listed brokers jumping over 10% and A-share stablecoin-related equities rebounding sharply.
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A New Era for Chinese Financial Institutions
Guotai Junan International, a subsidiary of the Guotai Junan and Haitong Securities group, has officially upgraded its Type 1 (Dealing in Securities) license under Hong Kong’s Securities and Futures Commission (SFC) framework. This allows it not only to facilitate virtual asset transactions but also to provide investment advice and issue or distribute virtual asset-linked products—including over-the-counter derivatives.
This regulatory green light positions Guotai Junan International as a trailblazer among Chinese financial institutions venturing into digital assets. As one of the first Chinese brokers to go public on the Hong Kong Stock Exchange, its core operations span wealth management, brokerage, investment banking, financing, asset management, and financial product distribution.
The firm's early success stems from years of strategic preparation in digital finance. In 2024, it launched structured products based on spot virtual asset ETFs—a regional first—and was authorized by the SFC to act as an introducing agent for virtual asset trading platforms. By early 2025, it had further expanded into tokenized securities advisory and digital bond issuance.
Now, with full virtual asset trading capabilities, Guotai Junan International completes a vertically integrated service chain in the digital asset space—setting a benchmark for peers aiming to follow.
Market Reaction and Sector-Wide Implications
The market’s enthusiastic response reflects strong investor appetite for institutional-grade crypto access. On June 25, Hong Kong’s brokerage sector rallied collectively:
- First Shanghai Capital: +30%
- Shenyin & Wanguo Hong Kong: +32%
- Over ten firms posted gains exceeding 10%
In mainland China, the A-share stablecoin concept index reversed earlier losses. Key players like Jingbei North (002987.SZ) and Jida Zhengyuan (003029.SZ) saw significant rallies, with several stocks surging over 10%. Payment technology firms including Lakala and Newland Payment also gained traction, signaling renewed confidence in blockchain-adjacent financial infrastructure.
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Regulatory Framework Driving Institutional Adoption
Hong Kong’s clear regulatory approach has enabled this institutional evolution. Under current SFC guidelines, virtual asset activities fall within an expanded version of traditional licensing:
- Type 1 License (Dealing in Securities): Required for trading "security-like" digital tokens; must partner with SFC-licensed virtual asset exchanges.
- Type 4 License (Advising on Securities): Permits advisory services on virtual assets.
- Type 7 License (Providing Automated Trading Services): Supports algorithmic trading systems.
- Type 9 License (Asset Management): Needed for managing virtual asset funds, limited to professional investors.
Notably, intermediaries holding Types 1 and/or 4 licenses may now offer virtual asset trading and advisory services to existing clients—provided they comply with strict custody, risk disclosure, and anti-money laundering protocols.
There are currently 11 SFC-licensed virtual asset trading platforms operating in Hong Kong, including HashKey Exchange and OSL Digital Securities. According to industry sources, Guotai Junan International is likely partnering with HashKey to power its backend trading infrastructure.
Competitive Landscape: Who’s Next?
While international brokers like Tiger Brokers, Futu, and Interactive Brokers entered the space earlier, local Chinese firms are now catching up fast. Tiger Brokers began offering virtual asset trading in May 2024 after upgrading its license, enabling clients to manage both traditional equities and crypto on one platform.
For established exchanges like HashKey, the entry of large brokers presents both competition and collaboration opportunities. With their vast client bases and robust compliance frameworks, traditional brokers could divert significant trading volume from standalone platforms. Yet, under Hong Kong’s omnibus brokerage model, these institutions often rely on licensed exchanges for custody and execution.
HashKey’s Sales Director Zhu Zhenyu confirmed that several top-tier Chinese brokers—including multiple top-five and top-ten firms—are already in advanced stages of integration. These include system connectivity, legal agreements, and regulatory upgrades—all paving the way for imminent service launches.
Moreover, HashKey is exploring partnerships beyond brokers, engaging with commercial banks, fintech giants, and payment providers to broaden ecosystem access.
The Broader Trend: Institutionalization of Digital Assets
The move signals a broader trend: digital assets are being integrated into mainstream finance. As noted by Professor Tian Lihui, Dean of Nankai University’s Institute of Financial Development:
“Traditional brokers entering the space enhances market legitimacy. Investors gain access to professional advice, risk management tools like OTC derivatives, and secure custodial solutions—all within familiar platforms. This reduces speculative behavior and accelerates the shift toward institutionalized, diversified markets.”
For retail investors, this means lower barriers to entry. Instead of navigating complex standalone exchanges, users can now trade crypto directly within their trusted securities apps—streamlining access while enhancing compliance and security.
Future Outlook: More Players Expected to Join
Industry analysts expect a wave of similar moves over the next 1–2 years. Firms like CITIC Securities and Haitong International are actively evaluating their strategies. CITIC has confirmed internal discussions around virtual asset services, while Xingye Securities’ offshore arm held emergency meetings following Guotai Junan’s announcement.
Even Guolian & Minsheng’s Hong Kong subsidiary has initiated application procedures for equivalent licensing.
However, smaller brokers face steeper hurdles due to limited international presence, tighter capital requirements, and heightened regulatory scrutiny. Some mid-sized firms have openly stated they’re avoiding crypto due to sensitivity concerns or lack of overseas infrastructure.
Still, the potential rewards are substantial. According to a CITIC Securities research report, Chinese brokers can tap into multiple revenue streams across the virtual asset value chain:
- Brokerage commissions
- Asset management fees
- Underwriting tokenized securities
- Equity investments in blockchain ventures
- Structured product development
Frequently Asked Questions (FAQ)
Q: Can all Chinese brokers offer crypto trading now?
A: No—only those with upgraded SFC licenses and partnerships with licensed virtual asset exchanges can provide these services. Guotai Junan International is currently the first mainland-backed broker with full approval.
Q: Is my crypto safe if traded through a traditional broker?
A: Yes. These platforms operate under strict SFC regulations requiring secure custody arrangements, risk disclosures, and investor protection measures—offering higher safety than many standalone exchanges.
Q: Do I need a separate account to trade crypto via my broker?
A: Typically not. Most integrated platforms allow you to trade both stocks and crypto within the same app using your existing securities account.
Q: What types of crypto can I trade?
A: Initially, major assets like Bitcoin (BTC), Ethereum (ETH), and stablecoins such as USDT are available. More tokens may be added as regulatory clarity improves.
Q: Are there restrictions on who can invest?
A: While retail access is permitted through certain platforms, some products like virtual asset funds remain exclusive to professional investors under SFC rules.
Q: How does this affect the overall crypto market?
A: Greater institutional participation brings increased liquidity, reduced volatility, and enhanced credibility—key steps toward long-term market maturity.
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Conclusion
Guotai Junan International’s breakthrough represents more than just a corporate milestone—it’s a signal of structural change in global finance. As more traditional institutions embrace digital assets under clear regulatory frameworks, investors stand to benefit from safer, more accessible, and professionally managed exposure to blockchain-based opportunities.
With Hong Kong positioning itself as a leading international virtual asset hub, the next phase will likely see deeper integration between legacy finance and decentralized innovation—ushering in a new era of inclusive, compliant digital wealth creation.