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Hong Kong Securities and Futures Commission: For public fund products with virtual assets accounting for more than 10%, the management agency must apply to the Securities and Futures Commission

Hong Kong Securities and Futures Commission issued a notice stating that public fund products with virtual assets accounting for more than 10% must meet corresponding conditions for their management companies, related investment strategies, and product custody institutions. According to current regulations, generally speaking, institutions holding the Hong Kong Securities and Futures Commission's License No. 9 are not allowed to have virtual assets accounting for more than 10% in their fund portfolios. The latest notice clarifies that if the proportion of virtual assets exceeds (or is expected to exceed) 10%, the management institution must apply to the Hong Kong Securities and Futures Commission for approval before the related products can be sold to Hong Kong investors.

The notice clearly points out that firstly, companies managing virtual asset funds (funds with virtual assets accounting for more than 10%) must have a good compliance record, and the company must have at least one employee with experience in managing virtual assets or related products. The management company must meet the existing or new requirements of the issuing regulatory authority for virtual asset management companies.

In terms of investment targets, virtual asset funds can only invest in virtual assets traded on licensed virtual asset trading platforms in Hong Kong. If investing in futures varieties, they must invest in futures contracts traded on trading exchanges or platforms recognized by the Hong Kong Securities and Futures Commission.

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