The financial world is undergoing a quiet revolution, and one recent development has sent shockwaves through the industry: Guotai Junan International (1788.HK) has officially upgraded its Securities and Futures Commission (SFC) license to include virtual asset trading services. Announced on June 24, 2025, this move positions the firm as the first Chinese-owned securities house in Hong Kong with full-spectrum capabilities in digital asset trading, advisory, issuance, and derivatives.
The market reacted swiftly — Guotai Junan International’s share price surged over 198% on June 25, reflecting investor confidence in its strategic leap into the future of finance.
But why does a single regulatory approval carry such weight? And what ripple effects could it trigger across traditional finance?
Let’s break it down.
What Is a Virtual Asset Service Provider (VASP) License?
A Virtual Asset Service Provider (VASP) license, issued by Hong Kong’s Securities and Futures Commission (SFC), authorizes firms to legally provide a range of digital asset services. These include:
- Trading services: Operating platforms for buying and selling cryptocurrencies like Bitcoin and Ethereum.
- Custody solutions: Secure digital wallets for storing virtual assets.
- Advisory services: Offering professional guidance on virtual asset investments.
- Product issuance and distribution: Launching structured products tied to crypto or tokenized real-world assets.
Under Hong Kong’s regulatory framework — particularly the Securities and Futures Ordinance and the Anti-Money Laundering and Counter-Terrorist Financing (Amendment) Ordinance 2022 — any centralized platform offering crypto trading must obtain proper licensing. Since June 1, 2023, all such platforms must either hold a VASP license or qualify under deemed licensing rules.
This ensures investor protection, compliance with AML/CFT standards, and operational transparency.
Why This License Upgrade Matters
Guotai Junan International didn’t just apply for permission — they executed a well-timed, forward-looking strategy.
In 2024, the company launched structured products based on spot Bitcoin and Ethereum ETFs, became an introducing agent for virtual asset trading platforms, and secured SFC approval to distribute tokenized securities. By early 2025, they had already initiated digital bond issuance, laying the groundwork for a seamless transition into full VASP compliance.
Now, with the upgraded license, they offer clients direct access to trade major cryptocurrencies and stablecoins like Tether (USDT) within a regulated environment — blending traditional brokerage trust with next-generation financial tools.
Their achievement marks more than internal growth; it signals a strategic shift in the entire brokerage ecosystem.
Core Keywords:
- Virtual Asset Service Provider (VASP)
- Cryptocurrency trading
- Tokenized securities
- Stablecoin
- Digital asset regulation
- Blockchain finance
- Hong Kong fintech
- Crypto ETF
Strategic Implications: Beyond Just Trading
According to analysts at Dongwu Securities, Guotai Junan International’s new status enables three transformative advantages:
1. High-Margin Revenue Streams
Traditional stock brokerage fees are thin. In contrast, crypto trading commissions, stablecoin clearing revenue (as an alternative to SWIFT), and structured derivative design fees offer significantly higher margins. This diversification strengthens profitability while reducing reliance on volatile market volumes.
2. First-Mover Advantage in Digital Finance
Hong Kong is actively positioning itself as a global virtual asset hub, supporting initiatives like spot crypto ETFs and RWA (real-world asset) tokenization. With full licensing, Guotai Junan gains early access to innovate in areas like:
- Issuing regulated stablecoins
- Tokenizing bonds, funds, and private equity
- Building cross-border settlement rails using blockchain
This isn’t just about offering crypto trades — it’s about becoming a digital financial infrastructure player.
3. Catalyst for Industry-Wide Transformation
As noted by Huachuang Securities’ non-bank financial team, Guotai Junan’s success proves that large, reputable Chinese financial institutions can navigate complex crypto regulations safely and profitably.
This validation may accelerate similar moves by other major players — including CITIC Securities International, CICC, and China Merchants Securities (HK) — potentially triggering a wave of “Type 1 License Upgrades” across Hong Kong-based subsidiaries.
👉 See how institutional investors are reshaping capital flows through tokenized assets.
The Broader Ecosystem Impact
The ripple effects extend beyond brokers.
For Fintech & Blockchain Firms
Demand is rising for:
- Secure blockchain infrastructure
- Smart contract auditing
- On-chain compliance monitoring tools
These form the backbone of trustworthy digital finance — creating opportunities for tech innovators aligned with regulatory standards.
For Payment Providers
Integrating stablecoins into cross-border payment networks allows faster settlements at lower costs compared to legacy systems like SWIFT. Payment gateways that adopt these rails can capture new fee-sharing models while improving user experience.
For Asset Managers
Tokenized money market funds, bond ETFs, and even REITs are emerging on-chain. These programmable assets enable 24/7 trading, fractional ownership, and automated yield distribution — meeting growing demand for “on-chain income” products.
As a result, AUM (assets under management) in digital formats is poised for exponential growth.
Frequently Asked Questions (FAQ)
Q: What does “upgrading to a VASP license” actually mean?
A: It means Guotai Junan International can now legally offer cryptocurrency trading services — such as buying/selling Bitcoin or stablecoins — directly through its platform, under strict SFC oversight.
Q: Is this only for institutional clients?
A: While initial offerings may target qualified investors, the long-term goal is to expand access to retail clients who meet suitability and risk assessment criteria under Hong Kong regulations.
Q: How does this affect traditional stockbroking?
A: It complements it. Clients can manage both conventional securities and digital assets in one integrated account, enhancing convenience and opening new revenue channels for brokers.
Q: Can other Chinese brokers follow this path?
A: Yes — and many likely will. Guotai Junan has demonstrated a viable regulatory pathway, reducing uncertainty for peers considering similar upgrades.
Q: Are stablecoins safe in this context?
A: When offered by licensed providers and backed by transparent reserves (like USDT or USDC), stablecoins become powerful tools for value transfer. Regulatory oversight adds an extra layer of security.
Q: Where can I verify which firms are licensed for virtual assets in Hong Kong?
A: You can check the official SFC public register at https://apps.sfc.hk/publicregWeb, search under “Virtual Asset-Related Activities,” then select “Providing virtual asset trading services through an omnibus account arrangement.”
Looking Ahead: The Rise of the Digital Financial Hub
Guotai Junan International’s breakthrough isn’t just a corporate milestone — it’s a bellwether for the convergence of traditional finance and blockchain innovation.
With Hong Kong pushing hard to become a global leader in virtual assets, institutions that act now stand to gain disproportionate influence in shaping the next era of finance.
From cross-border clearing via stablecoins to tokenizing real estate and debt instruments, the possibilities are vast — and the time to build is now.
👉 Explore the future of regulated digital finance and how institutions are leading the charge.