HKEX Introduces Digital Asset Index Amid Hong Kong’s Cryptocurrency Licensing Expansion

The Hong Kong Exchanges and Clearing (HKEX) has unveiled a new series of digital asset indexes aimed at providing a cohesive reference price for Bitcoin and Ether. This initiative is designed to align with the trading hours of the Asia-Pacific region, enhancing transparency within the digital asset marketplace.

Launch of the Digital Asset Index Series

The HKEX Virtual Asset Index Series is set to launch on November 15, giving investors a benchmark for Bitcoin (BTC) and Ether (ETH) prices in the Asian time zone. This index represents a significant step towards offering real-time data for digital assets in the region.

This launch coincides with the Hong Kong Securities and Futures Commission’s (SFC) ongoing efforts to issue more licenses for digital asset exchanges by the end of the year.

Eric Yip, the executive director at the SFC, remarked that the commission has received positive feedback from firms regarding the licensing initiative.

Main Features of the New Index

The HKEX Virtual Asset Index Series aims to provide a single reference price for BTC and ETH. It achieves this through a volume-weighted average sourced from multiple reputable exchanges.

According to an official announcement, the index series complies with the European Union Benchmarks Regulation (BMR), making it the first of its kind in Hong Kong.

Bonnie Y Chan, CEO of HKEX, emphasized that the series is intended to assist investors in making informed decisions to foster the growth of the virtual asset ecosystem.

“We are excited to launch the HKEX Virtual Asset Index Series to address the increasing demand for this rapidly evolving asset class.”

SFC’s Licensing Expansion

In conjunction with the HKEX index series, the SFC is finalizing complete licenses for various cryptocurrency exchanges that were previously granted provisional permits.

After a thorough five-month evaluation, the regulator discovered insufficient practices among some firms. However, it noted that most have since taken corrective actions.

By early 2025, the SFC plans to establish a consultative panel with licensed exchanges to enhance cooperation and regulatory compliance.

This regulatory expansion will also encompass over-the-counter trading desks and custodians, further strengthening oversight in Hong Kong’s digital asset markets.

Hong Kong’s Initiative for AI in Finance

On October 28, Hong Kong’s Financial Services and Treasury Bureau (FSTB) introduced new policies geared towards the secure implementation of artificial intelligence in the financial sector.

The agency outlined its approach to responsibly managing AI in finance in a document titled ‘Policy Statement on Responsible Application of Artificial Intelligence in the Financial Market.’

In this statement, the FSTB indicated that AI could be utilized across various functions, from risk management to customer service, thereby enabling innovative services and products.

“The introduction of generative AI products and services in 2022 has opened up significant opportunities for the industry,” the report stated.

In its recent efforts to foster AI adoption in finance, the regulator proposed a “dual-track approach” to tackle potential challenges while supporting AI innovation.