Hong Kong SFC Requires DeFi Projects to Be Licensed and Regulated, DEXs Involving Virtual Assets Also Need License Applications

On April 12, TuoniaoX.com reported that at the "2023 Hong Kong Web3 Festival," Choi Chung-fai, Acting Head of Intermediaries Division at Hong Kong Securities and Futures Commission (SFC), stated that DeFi projects need to be regulated by the SFC, automated trading services also fall under SFC regulation, and decentralized exchanges involving virtual assets also need to apply for licenses. Some DeFi protocols are nominally decentralized, but in reality, a small number of developers hold large amounts of governance tokens, requiring analysis of their substance rather than surface statements.