Crypto exchange BitMart has withdrawn its application for a Virtual Asset Service Provider (VASP) license in Hong Kong.
BitMart joins a growing list of major cryptocurrency platforms retreating from the city’s rigorous regulatory environment.
Hong Kong Securities and Futures Commission (SFC)’s updated list of virtual asset trading platforms confirmed BitMart’s withdrawal.
Prominent exchanges such as Bybit, OKX, and Gate, abandoned their VASP applications by the end of May 2024.
This wave of withdrawals comes as Hong Kong enforces stringent requirements for crypto exchanges.
The country aims to become a global financial hub while ensuring robust investor protection.
Hong Kong’s Tough Regulatory Framework
Hong Kong’s crypto regulations, enforced by the SFC, mandate that all centralized virtual asset platforms operating in the region obtain a VASP license.
This also extends to those marketing crypto to local investors.
The requirements are among the most demanding in the global crypto industry, designed to enhance transparency and security.
To secure a license, platforms must:
- Maintain liquid assets equivalent to at least 12 months of operating expenses.
- Hold a minimum of HK$5 million (approximately US$641,490) in paid-up share capital.
- Store 98% of client assets in cold storage, with transfers restricted to whitelisted addresses.
- Implement strict key management protocols.
- Secure insurance covering 100% of hot storage and 50% of cold storage holdings.
Additionally, new rules approved in August 2025 for crypto custody services bans the use of smart contracts for cold wallet management.
While they mitigate risks in the volatile crypto sector, they have prompted significant pushback from industry players.
A Wave of Withdrawals from Hong Kong VASP Application
BitMart’s decision mirrors a broader trend among crypto exchanges navigating Hong Kong’s regulatory landscape.
In May 2024, the SFC expelled unlicensed platforms as part of a deadline-driven crackdown.
Despite these withdrawals, Hong Kong has granted operational licenses to PantherTrade, YAX, Bullish, and BGE.
Currently, 11 exchanges operate as fully licensed platforms in the region, according to SFC records.
Hong Kong’s Crypto Hub Ambitions
CMB International Securities Limited, a subsidiary of China Merchants Bank, launched a crypto exchange in Hong Kong.
The Hong Kong Monetary Authority (HKMA) finalized its stablecoin regulatory framework in August 2025, introducing strict guidelines for issuers.
As Hong Kong continues to refine its crypto regulations, the balance between fostering innovation and ensuring compliance remains a focal point.
