Digital assets (abbreviated as “DA”), or commonly named as Virtual Assets (“VA”) before, refer to the assets that express value in digital form. DA generally rely on blockchain technology for accounting and verification of transactions. They can be in the form of digital commodities, crypto assets, non-fungible tokens (NFTs) or cryptocurrencies, but do not include those legal tender digital currencies issued by governments or central banks. They comprise the characteristics of decentralization, anonymity, high liquidity and potentially high returns.

“Digital Assets Related Products”, such as digital asset futures, exchange-traded Digital Assetd ETFs, refer to investment products that meet the following descriptions:

(a) Its key investment objective or strategy is to invest in Digital Assets;

(b) Its value is mainly derived from the value and characteristics of Digital Assets;

(c) Tracking or simulating investment results or returns that closely match or correspond to the performance of Digital Assets.

Digital Assets Related Products have been listed and traded on multiple stock exchanges, providing investors with options for Digital Assets listed products.

The Hong Kong SAR Government (“Government”) has been promoting the development of digital assets vigorously. According to the “Policy Statement 2.0 on the Development of Digital Assets in Hong Kong” issued in June 2025, the Government explicitly proposed to rename the term "Virtual Assets" to "Digital Assets" to better reflect the nature of such asset classes and be consistent with the understanding of the international market.

In the wave of digital economy, Digital Assets are gradually becoming an important element of the global financial market. From the initial Bitcoin to the current various forms including stablecoins and tokenized securities, Digital Assets have not only changed people's perception of "assets", but also reshaped the boundaries of traditional finance.

Digital assets are generally classified as high-risk asset classes. Investors should invest prudently when trading Digital Assets or Digital Assets Related Products.

Digital assets (DA), though generally referred to as “virtual assets” before, are actually not virtual or fictitious. They are real digital assets on distributed ledger technologies such as blockchain, which are tradable, storable and have certain value. DA do not rely on traditional financial institutions as issuers, but can circulate globally, becoming an important option for the new generation of asset allocation. Common digital asset types include:

1.Cryptocurrency: This is the most well-known type of digital asset, with representative assets including Bitcoin (BTC) and Ethereum (ETH). Crytocurrencies achieve decentralized transactions through blockchain technology. They do not rely on central banks or governments to issue them and are high in liquidity and market volatility.

2.Stablecoin: A stablecoin is a digital asset that is anchored to the value of a fiat currency or other assets, designed to reduce price fluctuations. For example, Tether (USDT) and USD Coin (USDC) are usually pegged to the US dollar and are widely used in transaction settlement and cross-border payments.

3.Real World Assets (RWA): It refers to the projection of real-world assets (such as bonds, real estate, commodities, etc.) onto the blockchain through tokenization, so that they have digital trading capabilities. For instance, products like tokenized green bonds and digital bonds have been gradually initiated in the Hong Kong market, becoming an important bridge connecting traditional finance and digital assets.

The common characteristics of the above digital assets are technology-driven and innovative. However, bearing in mind that complexity and market volatility nature of DA, their investment risks should NOT be ignored.

In order to invest in Digital Assets with security and trust, we recommend investor to start by choosing a formally licensed financial institution.  In Hong Kong, Digital Asset trading services are currently monitored by two regulatory paths. One is the specially established Virtual Asset Trading Platform operator (VATP) licensing system, and the other is based on the upgrade of existing securities licenses.

According to the Securities and Futures Ordinance and the Anti-Money Laundering and Terrorist Financing (Amendment) Ordinance, centralized Virtual Asset Trading Platforms (i.e. Virtual Asset Exchanges) that operate businesses in Hong Kong or actively promote their services to Hong Kong investors must obtain a VATP license approved and regulated by the SFC. This applies to institutions that provide automated trading services for digital assets such as Bitcoin. This kind of platforms usually focus on centralized trading services and must meet strict anti-money laundering, customer identity verification, asset custody and other requirements.

Existing licensed corporations can opt to upgrade their prevailing SFC Type 1 securities trading licenses and obtain the qualification to provide Digital Asset trading services by transmitting clients’ asset trading instructions to Digital Asset trading platforms under the existing regulatory framework. Guotai Junan Securities (Hong Kong) is among these institutions, which can provide transactions of Digital Assets such as tokenized bonds, securities-based stablecoins – while also providing value-added services such as transaction-based investment advisory.  Trading on a fully compliant platform is more than a safeguarding your own assets. It is also a commitment to upholding market integrity and fostering sustainable growth in the Digital Assets ecosystem.

In view of a wide variety of investment platforms in the market, how should ordinary investors judge their reliability? We recommend that investors consider the following three key points to help avoid possible hidden risks:

1.Check the license qualification

The most direct and effective way is to check through the official website of the Hong Kong Securities and Futures Commission (SFC). The information can be available in the “Public register of licenced persons and registered institutions” section. Investors can search by company name, license category or business type to confirm whether the platform has legal operating qualifications.

2.Understand the service scopes

In addition to the license qualification, investors should pay attention to "What services the license allows to provide?". For example, institutions holding Type 1 licenses (securities trading) and upgraded licenses, such as Guotai Junan Securities (Hong Kong), in addition to traditional securities business, can also provide digital asset trading and related investment advice, asset allocation and other value-added services; while VATP (virtual asset trading platforms) mainly focus on automated digital asset trading services.

3.Evaluate the background and reputation of the institution

It is crucial to choose a licensed institution with a good reputation and a solid background. Investors should be cautious to the following considerations:

- Does the institution provide comprehensive risk warnings and investor education resources ?

- Does the institution disclose audit reports and asset reserves regularly?

- Does the institution obtain positive comments or ratings from the international rating agencies (such as Moody's and S&P)?

Guotai Junan International Holdings Company Limited (GTJAI) is one of the key members in the Guotai Haitong Group, with over 30 years of local service experience in Hong Kong. In terms of international ratings, S&P awarded "BBB+" and Moody's awarded "Baa2" long-term issuer rating, and the outlook is "stable". GTJAI has branches in Hong Kong, Singapore, Vietnam, etc., with strong cross-border service capabilities and professional teams.

We recommend investors to evaluate these essential indicators in order to judge the dependability of a digital asset trading platform.

**Important Reminder**: Investment involves risks, and choosing a licensed and compliant platform is the first step to protect your own rights and interests.

In the world of Digital Assets investment, risk and opportunity go hand in hand. To ensure investor confidence when exploring digital finance, Hong Kong's regulatory framework not only mandates compliant platform operations but also establishes multiple layers of safeguards through licensed corporations.  

1. Investor Eligibility
Participation in Digital Assets trading is not open to everyone—only qualified clients may enter this market. Retail investors and professional investors have access to different product types, with the latter permitted to trade less liquid assets.  
To enforce this principle, licensed corporations require clients to complete the Client Risk Profile Questionnaire (CRPQ), assessing their investment experience, financial status, and risk appetite. Trading permissions are only granted when a client’s risk tolerance aligns with the product’s risk level.  
Additionally, clients must pass a Virtual Asset Knowledge Questionnaire before account opening, ensuring basic product understanding and risk awareness. This requirement not only enhances investor self-protection but also reflects the platform’s commitment to market stability.  

2. Trading Restrictions 
In terms of digital asset investment quotas, a clear upper limit is also set. Ordinary customers' digital asset investments shall not exceed 30% of their current assets, and vulnerable customers are limited to 20%. This differentiated quota management effectively prevents investors from suffering heavy losses due to excessive investment.

Morevoer, in order to mitigate systemic risks, licensed corporations are not allowed to provide financing services to customers. That is, digital asset transactions must be conducted with their own funds, and margin trading is prohibited. This restriction curbs the potential risks brought by high leverage operations to a certain extent, particularly providing safeguarding mechanism for novice investors.

3. Asset Custody
In terms of asset security, the Digital Assets platform adopts a dual cold-hot wallet system. Hot wallets are connected online for daily transactions and easy to circulate. Cold wallets, on the other hand, are stored offline, shielded from cyber threats and ensure asset security. Through this technical means, clients’ digital assets can strike a balance between accessibility and security.

 
Most importantly, client assets are strictly segregated from corporate funds of licensed corporations and are held by independent third-party custodians, ensuring absolute protection against misuse.  

As an emerging investment tool, digital assets are full of opportunities and risks. It is the responsibility of every investor to choose a licensed institution, understand their own risk tolerance, and comply with investment limits. In the era of digital finance, "understanding" is the ultimate safeguard. Investors should start with learning and compliance, and embrace the new possibilities of digital finance while protecting their own rights and interests.

Apply a Virtual Assets trading account are required to have the following criteria :

1. The client’s country or region of residence does not prohibit Virtual Assets trading activities.

2. Be an eligible individual, joint or corporate client with an existing securities account

3. Completion of a Knowledge of Virtual Assets

4. Client Risk Profiling Questionnaire to be assessed as Growth or Aggressive

5. To open a Virtual Assets trading account need a securities account with an internet trading function for online trading services

6. A valid email address is required to receive e-Statements for Virtual Assets trading account

To open a Virtual Assets trading account is required a valid securities account.

Existing eligible individual, joint or corporate securities account holders to trading Virtual Assets. Need to open a separate Virtual Assets account. Once Virtual Assets account has been successfully created (This account will have the same number as the securities account). The Funds and Virtual Assets in the Virtual Assets account will be separate from the securities account.

Existing individual securities accounts holders can apply Virtual Assets trading account in the “Junhong Global App (Chinese version only)”

In addition, Individual/Joint Account or Corporate Account holders can complete the additional account opening application form to apply Virtual Assets trading account.

Additional Account Opening Form (Individual/Joint Account)

Additional Account Opening Form (Corporate Account)

New clients who wish to open a Virtual Assets trading account are required to open a securities account first.

Individual client can use Online Account Opening (Chinese version only) to submit application for securities account.

For Joint or Corporate client, please visit  Account Opening webpage for more information on how to open a securities account.

To open a Virtual Assets trading account is required a valid securities account.

If client would like to close the securities account. Virtual Assets Trading account will also be closed.

Virtual Assets trading accounts only provide e-Statements, which can be viewed directly on the “Junhong Global App”(Chinese version only).

A notification will be sent to the registered email address when the new Virtual Assets trading account statement is available.

Cash deposits in a Virtual Assets trading account will not be entitled to any deposit interest.