Group 1 - The Hong Kong Securities and Futures Commission (SFC) issued a circular on August 15, outlining requirements for the robust custody of virtual assets, establishing a solid foundation for the industry to adopt advanced custody technologies under the ASPIRe roadmap [1] - The SFC's circular specifies a three-tier regulatory framework for virtual asset custody, including senior management responsibility, mandatory use of hardware security modules (HSM) for offline key generation, and a dynamic custody technology assessment mechanism to avoid liquidity suppression from "one-size-fits-all" regulations [1] - The new regulations require licensed platforms to purchase full insurance for custodial assets and establish a compensation fund, making Hong Kong the first region in the Asia-Pacific to achieve "qualified custodian" certification, significantly reducing bankruptcy risk exposure for stablecoin issuers [1] Group 2 - The China Communications Industry Association's Blockchain Committee highlighted that this modular regulation retains the stability of traditional securities regulation while providing flexibility for the management of reserve assets for stablecoins [1] - The China Research and Development Institute predicts that from 2025 to 2030, the digital currency market in China will maintain a 25% annual compound growth rate, with the market size exceeding 3 trillion yuan by 2030 and a digital yuan penetration rate reaching 55% [1] - In the A-share market, the Hong Kong Monetary Authority expects stablecoin transaction volume to account for 15% of global cross-border payments by 2025, indicating significant growth prospects for the digital currency industry represented by stablecoins [2]

Group 1: Financial Technology Surge - Financial technology stocks experienced a significant surge, with notable gains in companies such as Zhinan Zhen (20% limit up), Tonghuashun (over 17% increase), and Dazhihui (limit up), leading the financial technology sector to rise over 6% [2][5] - The Hong Kong Securities and Futures Commission issued a circular to licensed virtual asset trading platforms, outlining requirements for the secure custody of client virtual assets, which may have contributed to the financial technology boom [8] Group 2: Brokerages Performance - The surge in financial technology stocks positively impacted the brokerage sector, with all securities industry stocks closing in the green, including Longcheng Securities and Tianfeng Securities hitting their limit up [5] - The overall A-share market saw over 4,400 stocks rise, with a trading volume exceeding 1.3 trillion yuan, marking the 57th consecutive trading day surpassing 1 trillion yuan [9] Group 3: Debt Issuance and Market Dynamics - The brokerage sector has seen a significant increase in bond issuance, with a total of 479 bonds issued, amounting to 838.99 billion yuan, reflecting a year-on-year growth of 39.24% and 39.4% respectively [9] - The active market environment has led to an increase in margin financing and asset management product issuance, indicating strong capital replenishment needs within the industry [9] Group 4: AI and Technology Investment - Major securities firms are investing heavily in information technology, with the top ten firms spending over 15.579 billion yuan, showing a slight year-on-year increase of 1.4% [10] - AI technology is transforming the internet finance sector, with firms deploying AI models for various core business scenarios, enhancing operational efficiency and risk management [10]

Core Viewpoint - The Hong Kong Securities and Futures Commission (SFC) has issued a circular to all licensed virtual asset trading platforms, emphasizing the need for robust custody measures for client virtual assets in light of recent security incidents overseas that have resulted in significant client losses [1][2]. Group I: Management Responsibilities - Senior management is responsible for maintaining appropriate standards and ensuring effective resource utilization for business activities, as outlined in the guidelines [1][2]. - Platforms must designate at least one responsible person or core function supervisor to oversee critical matters related to custody and security [2]. Group II: Client Cold Wallet Infrastructure - Platforms must implement strict internal controls and governance procedures for private key management to ensure secure generation, storage, and backup of all cryptographic seeds and private keys [3]. - The use of Hardware Security Modules (HSM) is critical, and platforms must conduct due diligence and ongoing evaluations of HSM vendors [3][4]. - Cold wallets should not include smart contracts on public blockchains to minimize potential attack vectors [4]. Group III: Client Cold Wallet Operations - Platforms must establish comprehensive procedures to handle client virtual asset withdrawal requests to prevent losses from theft, fraud, or negligence [4][5]. - Regular assessments of potential attack vectors should be conducted, and multi-layered data integrity checks must be implemented throughout the transaction lifecycle [5][6]. - Monitoring measures should be robust to prevent unauthorized transactions from cold wallets, including strict oversight of any modifications to the cold wallet whitelist [5][6]. Group IV: Use of Wallet Solutions and Third-Party Providers - Platforms must ensure that any changes to systems are tested before deployment and conduct regular reviews to maintain integrity and security [10][11]. - Due diligence and ongoing monitoring of third-party service providers are essential to ensure compliance with the guidelines [11][12]. Group V: Continuous Real-Time Threat Monitoring - Platforms should implement adequate security monitoring measures, including establishing a Security Operations Centre (SOC) to coordinate incident detection [13][14]. - Real-time reconciliation of on-chain client assets with ledger balances is required, with immediate reporting of discrepancies [13][14]. - Continuous security monitoring should be conducted around the clock, including during holidays, with sufficient resources allocated for incident response [15][16]. Group VI: Training and Awareness - Platforms must allocate qualified personnel and resources for the design, development, and operation of systems, ensuring staff receive adequate training [17][18]. - Comprehensive training for transaction signers is crucial to understand verification protocols and appropriate handling of exceptions [17][18].

Core Viewpoint - The Hong Kong Securities and Futures Commission (SFC) has issued a circular to all licensed virtual asset trading platforms, outlining requirements for robust custody of client virtual assets, establishing a solid foundation for the industry to adopt advanced custody technologies under the ASPIRe roadmap [1] Group 1: Regulatory Requirements - The SFC has listed several good operational practices and minimum standards that virtual asset trading platform operators must meet, including responsibilities of senior management, infrastructure and operations of client cold wallets, use of third-party wallets, and real-time threat monitoring [1] Group 2: Future Implications - These standards will become core regulatory requirements for virtual asset custodians in the future, aiding the industry in establishing an effective virtual asset custody framework [1]