A financial association in Hong Kong opposes the tightening of crypto licensing requirements, arguing that it will deter traditional funds from participating.

Currently, funds can invest up to 10% in crypto without needing a separate license. The new proposal requires a full license even for just 1% investment, which is considered overly rigid and costly.

The association also opposes the mandatory local custody of crypto assets, as it creates difficulties for Web3 funds investing in early-stage tokens that are not yet supported by local custodians.