China Merchants Bank International (CMBI) has made headlines as the first Mainland China-backed brokerage to receive a virtual asset license from Hong Kong’s Securities and Futures Commission (SFC)—marking a key milestone in the region’s evolving approach to regulated crypto services.
CMBI Gains Regulated Entry Into Hong Kong’s Crypto Market
The license, issued on July 15, 2025, grants CMBI the right to offer virtual asset trading, custody, and advisory services in Hong Kong. This approval reinforces the city’s ambition to become a regulated hub for digital assets, offering clarity for both institutional players and retail investors.
According to reports, this move aligns with Hong Kong’s recent push to attract more licensed crypto entities, even as mainland China maintains a strict ban on cryptocurrency trading and services.
Access in Hong Kong, but Not Mainland China
Despite this significant step forward, the license does not permit CMBI to engage in crypto-related activities within mainland China. Legal experts, including Joshua Chu, co-chair of the Hong Kong Web3 Association, stressed that while the license allows operations in Hong Kong, strict cross-border restrictions remain in place.
“By securing this license, CMBI gains regulated access to Hong Kong’s dynamic crypto market, yet it must operate within strict boundaries that prevent direct mainland participation,” Chu told SCMP.
This reflects the delicate balance Beijing continues to maintain: encouraging innovation offshore via Hong Kong while enforcing domestic prohibitions on crypto speculation and trading.
Why This Matters for the Crypto Industry
CMBI’s licensing signals that traditional financial institutions from Mainland China are now engaging in digital asset markets, albeit indirectly. With Hong Kong providing a compliant framework, institutional players are finding regulatory pathways to enter crypto finance without violating mainland laws.
This development comes amid Hong Kong’s continued effort to attract global Web3 businesses and become Asia’s digital asset capital. Regulators have already licensed multiple exchanges and custodians under the new Virtual Asset Service Provider (VASP) regime, and CMBI’s inclusion marks the first from a state-affiliated banking group.
Conclusion
As crypto regulation evolves across Asia, CMBI’s entry into Hong Kong’s licensed virtual asset market sets a precedent for how Mainland-backed institutions can participate in Web3 innovation—while respecting cross-border legal constraints. It’s a strategic move that could signal broader institutional adoption in regulated jurisdictions.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.