Hong Kong’s Securities and Futures Commission (SFC) and the Accounting and Financial Reporting Council (AFRC) signed a memorandum of understanding on September 28, bringing licensed virtual asset service providers under the same audit and reporting scrutiny as traditional financial firms. The agreement covers three key areas: information sharing between the two regulators, case referrals when issues fall under the other’s jurisdiction, and coordinated enforcement activities spanning both agencies. Licensed VASPs must now appoint auditors and submit financial reports under specific sections of the Securities and Futures Ordinance, subject to the same professional standards and inspection regimes as auditors of publicly listed companies. The move addresses a persistent concern from institutional investors considering crypto allocations by ensuring reliable, audited financial information about virtual asset platforms, although it is technically non-binding within existing legal frameworks.
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