Hong Kong's Securities and Futures Commission (SFC) has announced new regulations that permit brokers to offer crypto margin financing and allow licensed platforms to provide perpetual contracts for professional investors. This move is part of Hong Kong's strategy to strengthen its position as a crypto hub. The new framework includes stringent risk management measures like leverage limits, margin requirements, and enhanced disclosures. Ongoing supervision will ensure that platforms maintain adequate internal controls. The SFC also issued guidance that allows licensed intermediaries to use a wider range of collateral for crypto trading, explicitly mentioning bitcoin and ether. Market makers affiliated with licensed platforms will now have clearer guidelines to improve liquidity while managing conflicts of interest. Tim Sun from HashKey Group noted that these changes address the issue of liquidity fragmentation, potentially enhancing market efficiency. In a recent speech, SFC Executive Director Eric Yip emphasized a focus on improving market quality rather than rapid expansion. He stated that this year's priorities include cultivating market depth and strengthening price discovery. Industry participants see these regulatory changes as a step toward integrating traditional securities with crypto assets, highlighting a gradual evolution in Hong Kong's regulatory approach to virtual assets.