Hong Kong is emerging as a global hub for cryptocurrency enterprises, offering a friendly regulatory environment and robust financial infrastructure. Hong Kong’s government has introduced clear regulations for digital assets while maintaining low taxes and free capital flow, making it attractive for crypto ventures . This step-by-step guide will walk you through defining your Bitcoin treasury company’s purpose, setting up the business, navigating legal requirements, and implementing best practices in Hong Kong’s 2024–2025 landscape. We’ll cover everything from company incorporation to regulatory compliance, funding, taxation, and operational considerations – ensuring you have a comprehensive roadmap to launch a Bitcoin treasury company in Hong Kong.
Step 1: Define Your Business Model and Purpose
Before diving into formalities, clarify the core purpose and model of your Bitcoin treasury company. There are several models to consider, each with different goals and regulatory implications:
- Bitcoin as a Corporate Reserve Asset: In this model, your company holds Bitcoin on its balance sheet as a treasury reserve or store of value. The idea is similar to MicroStrategy’s strategy – using Bitcoin as “a strategic reserve asset” and hedge against inflation . Companies following this model raise capital or use corporate funds to accumulate cryptoassets (primarily Bitcoin) and hold them long-term . For example, Hong Kong-based Reitar Logtech Holdings announced plans to buy up to 15,000 BTC (~$1.5B) as a balance sheet investment . This model signals to investors that your company is forward-thinking, leveraging Bitcoin’s long-term appreciation potential and “offering investors a regulated entry point into the asset class” via equity in your company .
- Investment Management or Fund Model: Here, the company operates as an investment vehicle or asset manager focusing on Bitcoin and other digital assets. The company might pool funds (internal or external) to actively manage a Bitcoin portfolio or run a Bitcoin fund. Some public companies have even been created explicitly to raise money (through stock offerings, convertible notes, etc.) and deploy it into crypto holdings . This model provides indirect exposure to Bitcoin for investors, with the company acting similarly to a fund – for instance, raising capital via equity or bonds and using those proceeds to buy Bitcoin for long-term holding . (Note: managing assets for others in Hong Kong will trigger SFC licensing requirements – more on this in Step 3). The upside is leveraging capital markets to support your treasury strategy, as seen with firms issuing shares or notes specifically to accumulate Bitcoin reserves .
- Tokenized Asset Issuance Model: In this model, the company issues digital tokens representing assets or value, using Bitcoin or other reserves as backing. Examples include issuing a stablecoin (e.g. a HKD-pegged stablecoin fully backed by Bitcoin or fiat reserves), or tokenizing real-world assets like bonds or equity on a blockchain. Hong Kong is actively exploring and supporting tokenization of real assets – for instance, the government issued tokenized green bonds in 2022, and regulators have a framework to integrate virtual assets with the real economy . If you pursue this model, be aware of regulatory classification: tokens that function like securities will fall under securities laws , and fiat-backed stablecoins require a license from 2025 onward . Hong Kong’s new Stablecoin Ordinance (effective Aug 1, 2025) mandates that only licensed issuers can offer fiat-referenced stablecoins, with requirements like HK$25 million minimum capital and 1:1 reserve backing . Token issuance can be an innovative route, but it introduces compliance complexity (SFC or HKMA oversight) and the need for robust audits and transparency.
Defining your model upfront is crucial because it determines your business plan, target market, and what regulations apply. For example, a purely internal Bitcoin treasury (holding your own corporate Bitcoin) has a different risk profile and compliance load than running a crypto investment fund or a token issuance platform. Many companies start with a simple reserve strategy and evolve their model over time, but you should clearly state your initial focus – whether it’s boosting corporate treasury with Bitcoin, offering investment products, or building tokenized solutions. This clarity will guide your incorporation, licensing, and operational steps in the following sections.
Many companies view Bitcoin as “digital gold” – a hard reserve asset on corporate balance sheets. Bitcoin’s long-term appreciation and scarcity make it attractive for treasury management. Studies predict that public companies globally could allocate hundreds of billions of dollars to Bitcoin in coming years . By defining your company’s model early, you set the stage for strategic decisions: how you will use Bitcoin (as a reserve, investment product, or token medium), how you’ll generate value, and what regulations you need to prepare for.
Step 2: Register and Incorporate the Company in Hong Kong
Once your vision is defined, the next step is to legally incorporate your company in Hong Kong. Hong Kong is known for its efficient company formation process and welcoming approach to foreign entrepreneurs. You can incorporate a private limited company (Ltd) in a matter of days . Here are the key steps and requirements:
- Choose a Company Name and Structure: Decide on a unique company name (in English or Chinese) that isn’t already in use. Most crypto businesses in Hong Kong use the private limited company structure, as it offers limited liability and flexibility . (Hong Kong also allows sole proprietorships and partnerships, but these are less suitable for a serious venture and don’t provide liability protection .) Ensure the name complies with Companies Registry rules (no offensive words, not too similar to existing names, etc.) and includes “Limited” or “Ltd” as required . You can search name availability on the Companies Registry e-Search portal .
- Meet Basic Incorporation Requirements: Hong Kong allows 100% foreign ownership and has minimal hurdles. You need at least one director (a natural person aged 18 or above, any nationality) and at least one shareholder (who can be the same person as the director). There is no residency requirement for directors or shareholders. However, you must appoint a Hong Kong-based company secretary (either an individual resident or a corporate service provider in HK) . You also need a registered office address in Hong Kong (a physical address for receiving official correspondence – many firms use the address of their law firm or corporate secretarial service) . Notably, no minimum share capital is required – you can incorporate with a share capital as low as HK$1 . (In practice, many companies start with a few thousand HKD as initial capital.)
- Prepare Documentation: Prepare the necessary incorporation documents: copies of directors’ and shareholders’ identification (passport/ID), proof of address, and the Articles of Association (the constitution of the company). You’ll fill out incorporation forms that list the company name, directors, shareholders, secretary, registered address, and share capital details . If using a service provider, they often supply template Articles of Association aligned with Hong Kong law. Ensure all information is accurate to avoid delays.
- Submit Incorporation Application: File the incorporation application to the Hong Kong Companies Registry (this can be done online via the e-Registry portal). The application includes the Form NNC1 (incorporation form) and the Articles of Association, plus payment of the government fees. As of 2024, the standard government fee is modest (around HK$1,720 for electronic incorporation and HK$2,000 for business registration for one year, though fees can change). Many opt to use a local corporate services firm to handle this process, but DIY is also possible online. The approval is fast – typically 1–2 days for electronic filings if all documents are in order . Once approved, you will receive the Certificate of Incorporation and the Business Registration Certificate (Hong Kong issues both documents upon successful company registration) .
Receiving the official Certificate of Incorporation signifies your company is legally registered in Hong Kong. After incorporation, you should also open a business bank account (see Step 7 for banking tips) and complete any post-incorporation tasks like issuing shares to the initial shareholder(s), creating statutory books, and making any necessary filings (e.g. Form IRBR200 within 1 month to the Inland Revenue Department for business registration, though nowadays the business registration is usually simultaneous with incorporation). Hong Kong companies must also file an Annual Return each year and notify the Companies Registry of certain changes (directors, address, etc.), so be prepared to maintain good corporate housekeeping with the help of your company secretary.
Summary of Incorporation Requirements:
- Entity Type: Private Company Limited by Shares (most common for startups) .
- Directors: Minimum one (must be an individual). No local residency required.
- Shareholders: Minimum one (can be corporate or individual). 100% foreign ownership allowed.
- Company Secretary: Required, must be local (HK resident or company) .
- Registered Address: Required in Hong Kong (no P.O. boxes).
- Share Capital: No minimum requirement (common to start with a small amount, e.g. HK$1–10,000) .
- Timeline: ~1–3 business days for electronic incorporation .
- Documents: Incorporation form, Articles of Association, IDs/address proof for founders.
Hong Kong’s straightforward setup process means you can establish your Bitcoin treasury company swiftly. Tip: Even if you’re not physically in Hong Kong, you can complete incorporation remotely by using online services or local agents – a major convenience of Hong Kong’s business-friendly regime. With your company officially formed, you can move on to the critical step of understanding regulatory obligations for crypto-related activities.
Step 3: Understand Regulatory and Licensing Requirements for Digital Assets
Hong Kong has a well-defined but evolving regulatory framework for companies dealing with Bitcoin and other virtual assets. To operate legally and avoid hefty penalties, you must identify which licenses or compliance rules apply to your business model. Below is an overview of the key regulatory regimes:
1. Securities and Futures Commission (SFC) – Virtual Asset Regulations: The SFC is Hong Kong’s securities regulator, and it oversees many crypto-related activities under the principle “same activity, same risks, same regulation.” Hong Kong distinguishes security tokens from non-security crypto (like Bitcoin) – tokens that have features of securities (e.g. shares, debt, or profit rights) are regulated like traditional securities under the Securities and Futures Ordinance . Pure cryptocurrencies such as Bitcoin or Ethereum are considered virtual commodities and “exempted from securities regulations” as long as they are not part of a fraud or collective investment scheme . This means simply holding or transferring Bitcoin on your own account does not require an SFC license (Bitcoin is not treated as a security). However, many crypto business activities are now regulated by the SFC or soon will be:
- Operating a Crypto Trading Platform or Exchange: As of June 1, 2023, Hong Kong implemented a Virtual Asset Trading Platform (VATP) licensing regime. Any business operating a centralized exchange or trading platform for virtual assets (even if the assets are not securities) must obtain a VASP license from the SFC under the amended Anti-Money Laundering and Counter-Terrorist Financing Ordinance . This license allows platforms to serve retail investors under strict investor protection standards. Licensed exchanges must implement rigorous AML/KYC checks, monthly proof-of-reserves audits, and segregation of client assets to protect users . If your treasury company plans to run an exchange, brokerage, or any service matching buyers and sellers of crypto, you must get this SFC license or risk severe penalties (unlicensed operation carries fines up to HK$5 million and 7 years’ imprisonment) . The licensing requirements for VATPs include being a Hong Kong-incorporated company, passing a fit-and-proper test, employing at least two Responsible Officers (executives with relevant experience, one of whom must reside in HK), and maintaining minimum financial resources (currently HK$5 million paid-up capital and at least HK$3 million in liquid capital) . In short, if your business model involves facilitating trades for others (exchange or OTC platform), budget time and money for the SFC’s licensing process.
- Asset Management or Advisory Services: If your company will manage crypto assets on behalf of clients or a fund, or advise others on crypto investments, you likely need to be licensed by the SFC just as any other asset manager or advisor. Specifically, managing a portfolio of securities (which can include security tokens or even a tokenized Bitcoin trust) triggers the Type 9 (Asset Management) license; giving investment advice can trigger a Type 4 (Advising on Securities) license. The SFC has issued guidance that licensed traditional asset managers (Type 9) can include up to 10% of their portfolio in virtual assets for clients, and separate guidance for managing pure virtual asset funds (for professional investors) . If you plan to create a Bitcoin investment fund or trust, you’ll need to either partner with an existing SFC-licensed manager or obtain a Type 9 license yourself. Note that offering investment funds to the public in Hong Kong (retail investors) requires SFC authorization of the product, which is only just beginning for crypto ETFs and the like – initially, crypto funds are restricted to professional investors. Ensure you comply with any SFC circulars on virtual asset funds (e.g. suitability checks, risk disclosures, custody standards) if you go this route. In summary, for any activity where you manage or advise on crypto investments for others, consult the SFC’s licensing criteria and secure the appropriate licenses before launch.
- Tokenized Securities or Initial Token Offerings: If your company will issue digital tokens that represent equity, debt, profit-sharing, or any investment scheme, those tokens may be considered “securities” under Hong Kong law . This means you must either register a prospectus for any public offering or rely on private placement exemptions (offering only to professional investors, for example). The SFC actively enforces against unauthorized securities offerings even if done via tokens. So, if you plan a token sale (ICO/STO) to raise capital, treat it with the same rigor as a regulated securities offering. Additionally, if your token is a payment or utility token not deemed a security, you still must ensure compliance with advertising laws and anti-fraud provisions. Hong Kong has embraced tokenization of traditional assets – for instance, the SFC in Nov 2023 published guidance for intermediaries distributing tokenized securities and funds – but these activities remain under regulatory supervision. Bottom line: seek legal advice before issuing any token to ensure you meet SFC or other regulatory requirements.
2. Money Service Operator (MSO) License – Crypto-Fiat Transactions: Many crypto businesses in Hong Kong also need to comply with the Money Service Operator regime, which is overseen by the Customs & Excise Department under the Anti-Money Laundering Ordinance. An MSO license is required if your company will be exchanging between fiat currency and cryptocurrency as a service (e.g. running an OTC desk that lets clients swap HKD for BTC, or a remittance service using crypto) . Essentially, Hong Kong treats fiat-to-crypto exchange similarly to a money changer or remittance provider. If your Bitcoin treasury company will facilitate conversions of Bitcoin to/from HKD or other fiat for customers, you must apply for an MSO license. The MSO licensing process involves background checks (a “fit and proper” test for owners and directors, ensuring no criminal record especially for financial crimes) , AML/KYC policies, and suitable business premises for compliance inspections . Notably, pure crypto-to-crypto trading (no fiat involved) is not under the MSO regime, and if you are just handling your own corporate funds (not servicing clients), you don’t need an MSO license. But many crypto companies get an MSO license if there’s any chance they will touch fiat transactions, as Hong Kong explicitly “requires a Money Service Operator license to exchange cryptocurrencies to fiat funds” . The MSO license application is relatively quick (approximately 1–3 months processing) and does not prescribe a minimum capital requirement (unlike SFC licenses) – though you must show you have sufficient financial resources to run the business soundly . Keep in mind, MSOs must comply with ongoing AML/CFT duties: verifying customer identity, record-keeping, reporting suspicious transactions, etc., as per the AMLO. Failing to get an MSO license when required can lead to fines (up to HK$1 million) and imprisonment . So if your business model includes an exchange service or any handling of fiat money flows alongside Bitcoin, plan to obtain the MSO license.
3. Hong Kong Monetary Authority (HKMA) – Stablecoins and Money Services: The HKMA (Hong Kong’s de facto central bank) is stepping into the crypto regulation space chiefly for stablecoins and banking services. If your Bitcoin treasury company intends to issue a stablecoin or a token pegged to fiat (or even potentially commodity-backed tokens down the line), be aware that Hong Kong’s new stablecoin regime (coming into force in 2025) will require stablecoin issuers to be licensed by the HKMA . Initially, this targets fiat-referenced stablecoins (particularly HKD or USD-pegged). For example, issuing a USD-backed stablecoin in Hong Kong will require an HKMA license, HK$25 million capital, 100% reserve backing in high-quality liquid assets, audits, redemption at par for users, etc. . Non-compliance means you cannot offer such stablecoins to the public in HK. Additionally, HKMA regulates money storage and payment systems (Stored Value Facilities); if your business involves holding customer fiat balances (like a wallet service with fiat), you might need an SVF license unless exempt. Banking services themselves (like taking deposits or lending) are off-limits unless you are a licensed bank – some crypto firms have gotten in trouble for wording that made them sound like banks . Generally, for a Bitcoin treasury company, HKMA’s main touchpoints will be if you venture into stablecoins or if you interface with banks (which we discuss in Step 7). Keep an eye on HKMA fintech initiatives – Hong Kong has a fintech sandbox and is exploring central bank digital currencies and cross-border payment pilots, which could present opportunities for collaboration .
4. Other Compliance Considerations: No matter what, your company will need to implement strong AML/KYC procedures in line with Hong Kong law. Even if you are not required to be licensed, banks and counterparties will expect you to follow AML rules. Hong Kong adheres to FATF standards, so any transfer of funds (especially cross-border or large sums) may invoke the Travel Rule (information sharing on crypto transactions above a threshold). Ensure you have internal policies for screening transactions, sanction checks, and record-keeping. Data privacy (PDPO ordinance) should be respected when handling customer data. Cybersecurity is also implicitly required – SFC expects licensed firms to have robust cybersecurity for protecting digital asset wallets and private keys .
Finally, note that Hong Kong is expanding its regulatory regime in 2024–2025. In mid-2025, the government proposed new rules to license all virtual asset dealers and custodians (not just exchanges) . This means that in the near future, any business dealing in virtual assets on behalf of others (brokers, OTC dealers, market makers) or providing custody of crypto for clients will need to get licensed by the SFC . The proposed requirements mirror the exchange regime – e.g. dealers to maintain ≥ HK$5 million capital, custodians ≥ HK$10 million, and follow similar conduct rules . What this means for you: plan ahead. Even if certain activities (like pure OTC brokerage to institutions) are lightly regulated today (in 2024), they likely will require a license soon. Hong Kong’s direction is clear – to be a compliant crypto hub with full regulatory oversight. Embracing this will lend credibility to your company. Engage legal counsel early to determine the exact licenses you need (SFC, MSO, etc.), and build compliance into your business plan as a cornerstone, not an afterthought. It not only keeps you out of trouble but also builds trust with banks, customers, and investors.
Regulatory Requirements Snapshot: The table below summarizes which licenses or regulations typically apply to each model/activity of a Bitcoin treasury company in Hong Kong:
| Business Activity | Regulatory Considerations in Hong Kong |
| Holding Bitcoin as a corporate treasury (using company’s own funds, no external clients) | No special license required. Bitcoin is treated as a virtual commodity, not a security , so merely holding it on your balance sheet isn’t a regulated activity. However, you must still comply with AML laws for any large transactions and use reputable exchanges/banks for buying crypto (they will do KYC). If you’re a publicly listed company, adhere to disclosure rules regarding treasury assets. |
| Offering Bitcoin investment services or managing a crypto fund (investing on others’ behalf, or pooled funds) | SFC license required. Managing assets for investors triggers Type 9 (Asset Management) licensing if any token is a security or if marketed as a fund. Even if investing purely in Bitcoin, SFC requires fund managers handling virtual assets to be licensed and restricts distribution to professional investors unless approved . Advisory services would need Type 4 (Advisory) license. Also follow SFC’s guidelines for crypto funds (custody with SFC-approved custodians, risk disclosures, investor suitability checks, etc.). |
| Operating a trading platform or OTC desk (facilitating crypto buying/selling for clients, market making) | VATP/VASP license and/or MSO license. Running an exchange or platform for retail clients absolutely requires the SFC’s Virtual Asset Trading Platform license (since 2023) . This comes with HK$5M capital requirement and strict rules (KYC, token due diligence, reporting) . An OTC brokerage (especially if dealing with fiat conversions) will require a Money Service Operator (MSO) license for legal fiat-to-crypto transactions. In 2025 and beyond, even OTC and broker dealers will fall under an expanded mandatory SFC licensing regime . Plan to secure the necessary licenses before commencing operations. |
| Issuing tokens or stablecoins (e.g. tokenizing assets, launching a stablecoin or security token) | Depends on token type: If token is effectively a security (equity token, debt token, investment contract), you must comply with SFC securities laws – only offer to professional investors or get approval for a public offering . Security token platforms/trading also need SFC licenses. If issuing a stablecoin (fiat-pegged), Hong Kong’s new law requires a Stablecoin Issuer license from HKMA with HK$25M capital and stringent reserve/audit rules . If token is a utility token purely for your platform’s use, ensure it’s not a disguised security and follow consumer protection and advertising guidelines. Always consult regulators if unsure – Hong Kong authorities are receptive to fintech innovation but want it done within the legal framework. |
Step 4: Plan for Local Operations vs International Expansion
When structuring your Bitcoin treasury company, consider where you will operate and serve clients – just in Hong Kong or also overseas. Hong Kong is an excellent base for a crypto business, but you should plan for the scope of your operations:
- Operating Locally in Hong Kong: Running your business in Hong Kong gives you access to a stable financial system, rule of law, and a concentration of talent and service providers (legal, accounting, etc.) who understand crypto. Hong Kong’s regulators and courts have shown a proactive, adaptable approach to crypto – e.g. a 2024 court case affirmed that even DAOs must provide financial transparency in legal disputes . The advantage of focusing on Hong Kong is that you have a clear regulatory regime to follow (as described above) and favorable tax treatment (more on taxes in Step 6). You also benefit from Hong Kong’s status as a global financial center: a Hong Kong company carries credibility and is well-placed to attract investors from Asia and globally. If your initial market is Hong Kong (say, offering services to Hong Kong corporations or investors), you must ensure full compliance with local laws (licensing, advertising, etc.), but you won’t have to juggle multiple jurisdictions’ rules at the start.
- Serving International Clients: Many Hong Kong crypto companies serve clients across Asia or worldwide. Hong Kong imposes no capital controls – funds can flow in and out freely, which is ideal for a crypto business dealing with global capital. If you plan to take on overseas customers or investors, be mindful of foreign regulations. For instance, if you solicit U.S. investors, U.S. securities laws (SEC rules) might apply; if you offer a crypto service in Europe, EU’s MiCA regulations could be relevant. One approach is to segment your operations: keep the main company in Hong Kong for Asia-focused business and perhaps set up subsidiaries or partner entities in other key markets (like a U.S. entity if targeting U.S. accredited investors, etc.). Always avoid “actively marketing” regulated services in jurisdictions where you lack authorization – even Hong Kong’s law itself says if you actively market to the Hong Kong public, you need a Hong Kong license, even if based abroad . The reciprocal is wise: don’t actively market in other countries without legal advice. That said, Hong Kong’s common law system and regulatory clarity make it easier to achieve international recognition. Hong Kong has positioned itself as a gateway to China and Asia: for example, while Mainland China bans crypto trading, Hong Kong can serve as a regulated conduit for mainland institutions to indirectly participate (e.g. via approved ETFs) . Hong Kong’s free trade agreements also give your company access to ASEAN markets, providing a springboard into high-growth regions like Vietnam and Thailand for crypto adoption .
- International Compliance and Structuring: If you hold Bitcoin on behalf of an overseas parent company or use Hong Kong as a treasury center, consider any home country rules on treasury investments. Fortunately, Hong Kong allows multi-jurisdictional operations easily – you can incorporate in HK and operate globally, or vice versa (incorporate elsewhere and register as a non-HK company in Hong Kong if needed). Many crypto firms choose Hong Kong for its “meticulously measured, commercially viable regulatory framework” compared to stricter regimes in the US/EU . Leverage this advantage, but remain compliant with anti-money-laundering standards internationally (for example, if moving funds between Hong Kong and another country, comply with both sides’ AML rules). Hong Kong’s AML law is aligned with FATF global standards, which helps cover international expectations. If you plan to expand abroad, start building a compliance program that can adapt to multiple jurisdictions – hire compliance officers with international experience and consider obtaining certifications (e.g. Travel Rule solution providers) to smooth cross-border transfers.
- Local Presence and Networking: Even if your clientele is global, maintaining a substantial presence in Hong Kong is beneficial. This includes a local office, local directors or staff, and engagement with Hong Kong’s crypto ecosystem (join industry associations, attend government-organized fintech events, etc.). The Hong Kong government is actively promoting fintech and crypto with initiatives like the FinTech 2025 Strategy and regulatory sandboxes . By being present, you can access pilot programs or grants, and stay close to regulatory updates. It also signals to regulators that you are a serious player invested in Hong Kong, which can be helpful in licensing or when seeking regulatory guidance.
In summary, Hong Kong can be both your home base and a launchpad for international operations. Many companies use Hong Kong’s robust legal system to instill confidence for international investors – Hong Kong was ranked the most “crypto-ready” jurisdiction in a global report . Still, tailor your compliance to each market: for example, if you raise funds in Singapore or Europe, ensure you meet their offering rules in addition to Hong Kong’s. With proper planning, a Hong Kong Bitcoin treasury company can service clients worldwide while enjoying the city’s unique East-meets-West advantages.
Step 5: Develop a Fundraising Strategy (Internal Funding vs External Capital)
How you fund your Bitcoin treasury company is a critical strategic decision. There are two broad avenues:
1. Bootstrap with Internal or Corporate Funds: This means using the founders’ capital or an existing company’s balance sheet to finance the Bitcoin purchases and operations. For example, if you are an established business adding Bitcoin to your treasury (like an operating company diversifying cash into BTC), you might allocate a portion of retained earnings or cash reserves to this new venture. The benefit of internal funding is control and simplicity – you don’t answer to outside investors and can take a long-term view on holding Bitcoin without external pressure. Many companies initially buy Bitcoin with corporate cash (as a reserve asset) and only later consider raising money once they have a proven concept. If you choose this path, ensure you have enough liquidity outside of Bitcoin to cover operating costs (since Bitcoin’s price is volatile). Additionally, document the board/shareholder approval for using internal funds for Bitcoin purchases, as part of corporate governance best practices. Tax-wise, injecting personal or parent company funds into the Hong Kong entity can often be done as share capital or a loan; Hong Kong doesn’t tax capital injections, and there’s no thin-capitalization rule, so you have flexibility in capital structure.
2. Raise External Capital: If you need more capital to execute your strategy (for instance, to acquire a large Bitcoin position or to build trading infrastructure), you may consider raising money from outside investors. This could be through equity financing, debt issuance, or token sales (with caution as discussed). Hong Kong’s capital markets and investor community are increasingly open to crypto-related ventures. Here are some fundraising routes and their considerations:
- Venture Capital / Private Equity: Seek investment from crypto-focused VCs, family offices, or strategic investors. Hong Kong has a growing crypto VC scene and nearby mainland China has significant crypto investors (though they invest offshore due to PRC restrictions). Raising VC funding would involve preparing a pitch, term sheets, and likely giving up some equity. The advantage is these investors can bring expertise and networks. Make sure to clarify whether they are investing in the company’s equity or a specific fund vehicle (if you set up a fund). As always, comply with securities laws – a private sale of shares in your Hong Kong company to a small number of VC investors is generally allowed as a private placement (no public offering needed).
- Public Equity or Listing: A bold option some have taken is to list on a stock exchange or merge with a SPAC to raise very large sums. For instance, companies like MicroStrategy (now named “Strategy”) issued public stock and convertible bonds to buy Bitcoin , and in 2025 a firm called Twenty One Capital announced a $3.6B de-SPAC merger and PIPE raise to fund a massive Bitcoin purchase . In Hong Kong, listing rules for crypto-focused companies are still strict – the Stock Exchange of Hong Kong (HKEX) currently has reservations about pure cryptocurrency businesses unless they have substantial traditional revenue. No pure Bitcoin-holding company is listed on HKEX yet (as of 2025). However, anecdotally, some Hong Kong-listed firms have bought Bitcoin or crypto on their balance sheet (with proper disclosures). If you aim for public markets, prepare for intense regulatory scrutiny and the need for solid auditors, prospectus, etc. This route is usually only for later-stage when you need hundreds of millions in capital.
- Convertible Notes / Bonds: Convertible debt has been a popular mechanism for crypto treasuries . You could issue a convertible note to private investors – they lend money that can convert to equity later at a discount or fixed price. This gives downside protection to investors (debt claim if things go south) and upside if your company’s equity does well. MicroStrategy famously issued convertible bonds (even zero-coupon ones) to buy Bitcoin . In Hong Kong, issuing debt privately is feasible; a public bond would require an offering memorandum or note program. Ensure any such note complies with Hong Kong’s Companies Ordinance (restrictions on offering debt to public without a prospectus, unless to professional investors or under exemptions).
- Security Token Offering (STO): A more innovative approach is issuing tokenized equity or debt to raise funds. For example, you could tokenize shares of the company or a bond on a blockchain and sell those tokens to investors globally. Hong Kong does not prohibit STOs, but as mentioned, they are treated as securities offerings. This means you either limit to professional investors or use an SFC-licensed platform to conduct the STO. There have been a few SFC-approved security token offerings in Hong Kong in recent years (often tokenized debt for institutional buyers). If you have the tech capability, STOs can broaden your investor reach (including crypto-rich individuals), but you must engage SFC-regulated intermediaries to ensure compliance . It’s a complex but potentially rewarding path if done right.
- Initial Coin Offering (ICO)/Utility Token: Selling a pure utility token to raise funds (like many startups did in 2017-2018) is generally not recommended in Hong Kong without legal vetting. The SFC has made clear that many ICO tokens constituted securities or at least fell under regulatory ambit. The frenzy for unregulated ICOs has died down, and Hong Kong would likely consider such an offering illegal if targeting the public. Unless your token truly has no investment character and you geofence out Hong Kong investors, an ICO could land you in regulatory trouble. Proceed with extreme caution and legal counsel if considering this path.
When raising external capital, also decide what the money will be used for: Will it go entirely to buying Bitcoin (treasury assets), or partly to build product/platform around your treasury (such as software, custody solutions, etc.)? Many investors will want to see a business model beyond just “hold Bitcoin and wait,” unless your pitch is purely a Bitcoin holding company that gives traditional investors access via stock (akin to an ETF alternative). In fact, one of the key value propositions of Bitcoin treasury companies is providing an easy entry for investors to gain Bitcoin exposure through equity markets . If that’s your strategy, emphasize how you’ll manage and secure the assets, and any additional value you bring (e.g. expertise in trading to perhaps arbitrage or lend coins for yield, though that introduces risk).
Pros and Cons: Using internal funds means you retain full ownership and can move fast, but you may be limited by your own capital and will assume all the risk. Raising external funds gives you more firepower and shared risk, but you take on obligations to shareholders or creditors. You’ll need to maintain transparency and possibly face shorter-term performance pressures. Many crypto firms combine approaches: start with founder money to prove the concept, then raise VC money for growth, and later consider public markets or large private raises for scaling.
Also consider when to raise: Bitcoin’s market conditions can affect investor appetite. In a bull market, investors may be very keen to fund crypto ventures (for instance, the renewed bull run in early 2025 saw multiple companies raising huge sums to stockpile crypto ). In bear markets, you might rely more on internal funding or smaller strategic investments to ride through.
Finally, any fundraise should be accompanied by clear documentation and compliance: if issuing shares, update your company’s Articles if needed and register new shares with the Companies Registry; if taking a loan, formalize it with agreements. Ensure anti-dilution and voting arrangements are negotiated with investors to avoid future conflicts. Hong Kong’s legal system is very familiar with venture deals and financing, so you can tap into a strong professional community for help structuring deals.
In sum, decide on a funding strategy that aligns with your goals and risk tolerance. If your aim is modest (e.g. accumulate $5 million in Bitcoin over a year), perhaps internal funding or a couple of angel investors suffice. If you aim to become an institutional Bitcoin vehicle (like some companies aiming to acquire tens of thousands of BTC), you will need significant external capital and possibly public market involvement. Keep regulatory compliance in mind – raising funds from the public or many investors likely triggers prospectus requirements, whereas private raises to a few accredited investors are more straightforward in Hong Kong.
Step 6: Understand Taxation of Bitcoin in Hong Kong
One of Hong Kong’s biggest advantages is its simple, low-tax regime, especially regarding capital gains. But it’s important to grasp how Bitcoin and crypto transactions are treated for tax purposes:
- No Capital Gains Tax: Hong Kong does not impose capital gains tax on individuals or corporations. Profits from selling capital assets are generally not taxable . This means if your company buys Bitcoin and later sells it at a profit, that gain can be tax-free provided it is deemed a capital transaction. The Inland Revenue Department (IRD) has clarified that if digital assets are bought for long-term investment (capital purpose), profits from disposal are considered capital in nature and not subject to profits tax** . For example, if your Bitcoin treasury strategy is to hold BTC for several years as a reserve asset, and you occasionally rebalance, those sales might qualify as capital gains (thus not taxed). This is a major incentive – Hong Kong is far more favorable than jurisdictions like the US or UK which tax capital gains on crypto .
- Profits Tax on Business Income: On the other hand, if your company is actively trading or dealing in Bitcoin as a business, the IRD will treat the income like any other business profit. Hong Kong’s corporate profits tax rate is 16.5% on assessable profits (with a 8.25% rate for the first HK$2 million under the two-tier system) . The key determinant is whether your crypto activity is an investment or a trade. The IRD’s guidance suggests using traditional “badges of trade” tests – frequency of transactions, intention at purchase, holding period, etc. . If your company frequently buys and sells Bitcoin (short-term flips, active trading for profit), the IRD will likely view it as a trading business and tax the net profits at 16.5% . If you mainly hold long-term and only occasionally sell, it leans toward capital. Plan your strategy and documentation accordingly: For instance, record board resolutions or internal memos that the BTC is held as long-term treasury reserve, not as inventory for sale, to support capital treatment.
- Territorial Principle: Hong Kong taxes based on source of profits. If your Bitcoin transactions are managed and controlled in Hong Kong, the profits (if deemed business income) are Hong Kong-sourced and taxable. If somehow your profit is made outside Hong Kong, it could be outside the tax net. However, for a Hong Kong company actively managing crypto in HK, you should assume it’s HK-sourced. The good news is Hong Kong’s tax rate is low (16.5% vs ~21-25% or more in many countries) . Additionally, if you set up a fund that qualifies under Hong Kong’s offshore fund exemption or new carried interest concession, certain crypto investment profits could be exempt – but those are complex to ensure, and you’d need professional advice.
- No VAT/GST or Transaction Tax: Hong Kong has no VAT (Value-Added Tax) or GST. Crypto transactions are not subject to any sales tax . This is in contrast to some jurisdictions that charge VAT on exchange fees or on mining. Hong Kong’s absence of VAT/GST means you don’t worry about adding tax to crypto sales. There’s also no stamp duty or financial transaction tax on crypto (stamp duty only hits stock trading, real estate, etc.).
- Tax Treatment of Different Crypto Activities: The IRD’s guidance (DIPN 39) categorizes digital tokens into payment tokens (like Bitcoin), security tokens, utility tokens . Bitcoin is a payment token/virtual commodity, and the guidance confirms what we’ve covered: if held as investment, not taxable; if part of trading, taxable . Mining income, if you engage in mining, would be considered trading/business income (and any crypto earned would be assessed at market value when earned) . Staking or yield farming could be similar (not explicitly in DIPN, but likely treated as income if done systematically). If you decide to lend out your Bitcoin (to earn yield) as part of business, interest or fees earned would be taxable business income.
- Expense Deductions: If your company is paying tax on crypto trading profits, note that you can deduct related expenses – for instance, exchange fees, custody fees, interest on loans used to buy crypto, etc., as long as incurred in producing the taxable profits. Keep clear records of all expenses. If you have both taxable and non-taxable income (say you have some trading and some long-term holdings), expenses might need to be apportioned.
- Salaries Tax and Crypto Payroll: If you plan to pay any employees or contractors in Bitcoin, that is allowed, but it has tax implications for them. Hong Kong would treat it as if you paid them in cash – the income is measured at the crypto’s market value at time of payment and is subject to salaries tax (for employees) . You as an employer would need to report it on the employee’s IRD income statement (Form IR56E/B). This likely won’t affect your corporate tax, but it’s good to know for staff planning.
- Transfer Pricing: If you have a group structure (e.g., a parent company abroad funding the HK entity), Hong Kong has transfer pricing rules (as of 2018 BEPS changes). Ensure that any crypto asset transfers between related entities are at arm’s length market values to avoid disputes.
- Tax Reporting: Hong Kong companies file a Profits Tax Return annually (usually after 18 months of incorporation for the first return). Even if you think your crypto gains aren’t taxable (capital), you should disclose the holdings and possibly claim them as capital gains non-taxable. It’s wise to get a local accountant or tax advisor who’s familiar with digital assets to prepare your returns. The IRD is still ramping up knowledge on crypto, so clear disclosure and consistency will help avoid audits. The IRD DIPN 39 (March 2023) is a useful reference that you or your accountant should review .
- Tax Incentives: Hong Kong in recent budgets has hinted at or introduced incentives to attract crypto funds – for example, profits of offshore funds (including crypto funds) managed by SFC-licensed managers can be tax-exempt under certain conditions, and special tax concessions for family offices may apply. Keep an eye on any new government measures in 2024–2025 that might provide tax breaks for crypto investments or certain startups (the government signaled no intention to impose new crypto taxes, aiming to remain competitive).
In conclusion, Hong Kong’s tax regime is extremely favorable for a Bitcoin treasury company. No capital gains tax means if you successfully hold and sell Bitcoin at a higher price after a long term, the gain can be completely yours (no tax bite) . This is a compelling reason many crypto firms choose Hong Kong. Just be careful in delineating between capital vs revenue transactions: maintain a long-term investment approach in your documentation if you want capital treatment. And if you do any short-term or transactional business, be prepared to pay the fair 16.5% on those profits – a modest rate given global standards . Always consult a professional for complex cases, but overall, taxes should not be a heavy burden on a Hong Kong crypto enterprise.
Step 7: Establish Banking Relationships and Custody Solutions
Secure handling of funds – both fiat and crypto – is the lifeblood of a Bitcoin treasury company. You’ll need reliable banking partners for traditional currency needs and robust custody arrangements for your digital assets. Hong Kong has made progress in both areas, but they require careful planning:
Banking in Hong Kong for Crypto Companies: Historically, crypto startups worldwide have struggled to get bank accounts. Hong Kong is actively addressing this issue to support its crypto hub ambitions. In 2023, the Hong Kong Monetary Authority (HKMA) instructed major banks to open up services to licensed crypto firms, making clear that performing due diligence should not result in “undue burden” on legitimate crypto businesses . The HKMA even held meetings pushing banks like HSBC, Standard Chartered, and Bank of China to not unreasonably reject crypto clients . In practice, this means if your company is properly licensed (or clearly not engaging in illegal activities), Hong Kong banks are more willing to onboard you now than a few years ago. To bank smoothly:
- Prepare documentation: When applying for a bank account, be ready to explain your business model in plain terms. Provide your business registration, incorporation docs, directors’ IDs, proof of address, and perhaps a business plan summary. Banks will ask about your source of funds and expected account activities. Be transparent that you operate in the virtual asset space and mention any licenses (MSO, SFC) you hold or have applied for – having those makes a bank more comfortable.
- Choose the right bank: Hong Kong has traditional banks and new virtual banks. Some crypto companies have reported success with ZA Bank, a top digital bank in HK, which in 2023 even announced services to facilitate crypto trading and account services for crypto exchanges . ZA Bank and others like Pilot Bank (fictitious example for explanation) are inclined to work with fintech firms. Big banks (HSBC, Standard Chartered) may still be conservative but will follow HKMA guidance for licensed entities. It’s wise to approach multiple banks. Also consider smaller Chinese banks in HK or international ones (like Neat, now part of Airwallex, though that’s more a payments provider). Opening a Hong Kong bank account often requires meeting compliance in person or via video; utilize any introductions through programs like InvestHK or crypto industry groups to smooth the process.
- Foreign banking options: In case HK banking is slow, many firms also set up an account in a crypto-friendly jurisdiction or use international fintech solutions (e.g. multi-currency accounts). However, given your core operations will be in HK, having a local HKD account is important for paying local expenses and receiving any investor money. Hong Kong banks can also offer USD accounts which is useful if your investors send USD (common in crypto fundraising).
- Banking Compliance: Once you have an account, maintain it diligently. That means keeping proper records of your transactions – if the bank asks for proof of a large incoming wire (e.g. from selling BTC via an exchange), provide invoices or trade records. Show that you have internal AML controls: e.g. if you receive a large sum from a new counterparty, be ready to show the bank you did some KYC on that party. The HKMA expects banks to apply risk-based AML, so as your company grows, your bank might periodically review your compliance procedures.
Custody of Bitcoin and Digital Assets: Unlike fiat, Bitcoin requires specialized safekeeping. You must decide whether to self-custody (hold the private keys yourself) or use a third-party custodian. Considerations include security, insurance, regulatory requirements, and access:
- Self-Custody (In-House): If you have a small amount of BTC or are very confident in your security, you might manage your own wallets. This involves using hardware wallets or multi-signature wallets to store private keys offline (cold storage). Multi-signature (e.g. requiring 2-of-3 or 3-of-5 keys to move funds) is recommended for a company so that no single person can run off with the coins or lose a single key and cripple the treasury. You could distribute hardware devices to different trusted officers or even store one in a bank safe deposit box. Implement strict procedures: for example, two directors must sign any transfer out of cold storage, and use a fresh address system to maintain privacy. Pros: no custodial fees, full control. Cons: you assume all the risk – if keys are lost or compromised, there’s no recourse. Also, if you are SFC-licensed, self-custody might not satisfy regulatory standards unless done through an associated entity and audited.
- Third-Party Custodians: There is a growing industry of professional crypto custodians, some of which operate in Hong Kong or serve Hong Kong clients. These include firms like BitGo, Coinbase Custody, and Anchorage – in fact, Hong Kong companies like Reitar have listed Coinbase Prime and Anchorage Digital as custodial partners in their prospectus . Using a custodian can provide peace of mind: they often carry insurance against theft, have audited security practices, and can handle large volumes with multi-signature, geographic distribution, etc. Some custodians in Hong Kong might operate via trust companies (there are SFC-licensed trust companies offering digital asset custody). Note that under forthcoming HK rules, independent custodians will also need a VA custodian license (once that regime kicks in) , which could further vet their reliability. Pros: professional security, insurance coverage (e.g. BitGo offers insurance for assets in cold storage), compliance reporting (they can provide statements for auditors). Cons: fees (custodians charge either AUM-based or flat fees), and you have to trust a third party (counterparty risk). However, given Hong Kong’s regulatory push, using a licensed custodian can also bolster your credibility with investors and regulators.
- Hybrid Approach: Many companies do a mix – keep a certain amount in self-custody for quick access or small transactions, and the bulk in deep cold storage with a custodian. For example, you might keep 5% of your BTC in a readily accessible wallet for opportunistic trades or transfers, and 95% with a custodian under lock and key. This ensures liquidity while maximizing security for the majority.
- Custody Best Practices: No matter which route, follow best practices: use cold storage (offline) for the majority of coins (Hong Kong’s rules for exchanges mandate 98% of client assets in cold storage – you can use a similar high threshold for your treasury). Implement whitelisting of addresses if possible (so funds only move to pre-approved addresses). Conduct regular audits or checks of your holdings – you should be able to prove and verify your Bitcoin balance (e.g. sign a message from the address or use view-only access) for accounting and investor reporting. If using a custodian, review their SOC 2 reports or security certifications. Also, have a clear policy for key person risk: if a key holder leaves the company, promptly update access (rotate keys if self-custodied, or inform custodian to remove that person’s access).
- Insurance: Traditional insurance for crypto theft or loss is expensive but worth considering for a large treasury. Some custodians include a basic insurance coverage. You could also seek a separate policy (some insurers in London or HK underwrite crypto asset risk). Insurance might cover scenarios like employee theft or external hacks but will come with many conditions (proper security protocols must be followed, etc.). It adds a layer of financial protection and can reassure investors/shareholders that the treasury is protected.
- Custody Regulations: If you become SFC-licensed (e.g. running a fund), note that the SFC requires that custodied assets be held by a separate independent custodian (for funds, typically a trust or bank) or an SFC-registered associated entity, and they’ve set expected standards on digital asset custody (like robust key management, insurance, etc.) . Aligning with these standards voluntarily, even if not strictly required for your business, is wise. It shows you follow institutional-grade custody rules – e.g. separating client assets from corporate, which for your own treasury means maybe segregating any investor-owned coins vs company-owned coins distinctly .
Building Banking & Custody Relationships: Treat your bank and custodian as long-term partners. Invite them to understand your business deeply. With banks, for instance, have periodic check-ins with your relationship manager, update them on any new licensing you obtained, etc. For custodians, do due diligence annually – request any updates on their security or financial health. Hong Kong is encouraging a healthy ecosystem: banks are now more open to crypto, and we even see virtual banks integrating crypto trading services (ZA Bank’s retail crypto trading integration with licensed exchanges ). Possibly, by 2025, you might be able to keep your crypto in custody under a Hong Kong bank’s trust arm, should they launch such services (the HKMA has issued guidance for banks exploring token custody ).
In summary, secure your on- and off-ramps (banking) and your vault (custody) early on. Don’t wait until after you’ve raised money or bought Bitcoin to figure these out – a bank account is needed to receive investor funds and pay expenses, and custody must be ready before you start handling significant BTC. Hong Kong is making it easier: regulators are prodding banks to welcome crypto clients , and a number of reputable custody solutions are available. Leverage these resources so that your treasury operations run smoothly and safely. As the Motley Fool noted, many new crypto treasury companies rely on “off-the-shelf services” like established custodians for cold storage, insurance, and audits – this is great for security . By doing the same, you free yourself to focus on strategy rather than worrying about the physical safety of your assets.
Step 8: Maintain Compliance, Risk Management, and Best Practices
Launching the company is just the beginning – you need to operate it responsibly and adapt to changes. This final step covers ongoing best practices and recent developments to keep in mind:
- Stay Updated on Regulations: The crypto regulatory environment in Hong Kong is dynamic. Make it a habit to monitor announcements from the SFC, HKMA, and government. In 2024–2025, keep an eye on the progress of the new VA dealer & custodian licensing regime (expected to become law after the consultation in July 2025) . Also watch for the implementation of the Stablecoin Ordinance in 2025 – if your business touches stablecoins or you use stablecoins for liquidity, ensure you only deal with compliant stablecoins (since unlicensed stablecoins may only be tradeable by pros, and licensed ones will be preferred) . Hong Kong authorities also coordinate with international standards, so updates to FATF guidelines or IOSCO crypto asset rules could be reflected locally. Joining industry associations like the Hong Kong FinTech Association or crypto advocacy groups can keep you informed and give you a voice in consultations.
- Robust AML/CFT and Internal Controls: Treat compliance as a core function. As your business grows, implement internal AML policies: customer due diligence, transaction monitoring, and sanctions screening should be standard if you handle any client transactions. Even for proprietary activities, be vigilant – for example, if you receive Bitcoin from a new source, ensure it’s not tainted by illicit origin (blockchain analytics tools can help check for high-risk coins). Under Hong Kong’s AMLO, even unlicensed businesses can be penalized for facilitating money laundering. Given crypto’s global nature, you might get approached by high-risk characters – having a strict onboarding checklist (passport checks, verifying fund sources, etc.) will protect you. Regularly train any staff on AML obligations and red flags.
- Risk Management for Bitcoin Volatility: As a Bitcoin treasury, the biggest financial risk is obvious: price volatility. Have a risk management strategy. For example, decide a threshold where you’d rebalance your holdings (some companies set rules like if BTC grows beyond X% of total assets, they trim, or they keep a portion in stable assets to cover expenses). Avoid using leverage (borrowed money) to buy Bitcoin unless you are very confident – many firms have gotten burned by margin calls when prices swing. The Motley Fool article highlighted that these treasury companies face amplified downside if they take on debt to buy crypto . If you did issue debt (like convertible notes) to raise funds, ensure you have a plan to service interest or meet covenants even if Bitcoin dips significantly. Consider doing scenario analysis: what if BTC drops 50%? Does the company remain solvent and operational? It may be wise to keep a fiat reserve for a year of expenses so you’re not forced to sell BTC at a low to pay salaries or rent. Some treasury companies also diversify a bit (e.g. holding some Ethereum or other top assets, or even traditional treasuries) to mitigate single-asset risk , though this depends on your philosophy.
- Transparency and Reporting: If you have outside investors or are publicly listed, maintain clear reporting on your crypto holdings. Many companies do quarterly updates on their Bitcoin holdings and any material purchases or sales (e.g., MicroStrategy files 8-Ks in the U.S. for major Bitcoin transactions to inform shareholders). In Hong Kong, if you are a private company, these specifics aren’t public, but if you raised money by promising a Bitcoin reserve strategy, it’s good faith to update investors on progress. Also, maintain proper accounting records: determine how you will account for Bitcoin (likely as intangible asset under accounting standards, measured at cost minus impairment, unless you adopt fair value option). Keep track of every purchase price, so you can do impairment testing or gain/loss calculations. For risk management, consider obtaining an annual audit from an audit firm experienced in crypto – they will verify your holdings (often by having you sign messages from wallets or getting custodian confirmations) and check your internal controls. An audit can help reassure investors and also impose discipline on your record-keeping. Hong Kong’s courts have shown they expect crypto businesses to maintain financial records and transparency akin to traditional firms .
- Security and Business Continuity: Beyond custody itself, have a disaster recovery and business continuity plan. What if a key team member leaves, or if there’s a cyberattack on your systems? Ensure multiple people know the procedures to access funds (with appropriate segregation of duties). Backup critical data (like keys, if self-custodied, or account credentials for exchanges and banks) in secure offline ways. Consider the human factor: unauthorized trading or fraud can be a risk – implement multi-person approvals for moving large funds, and log all transactions. Regularly review wallet addresses and permissions. Additionally, plan for the unexpected: government changes (though Hong Kong is very pro-crypto now, always good to have contingency if policies shift), or market crises. It might be worth establishing relationships in a second jurisdiction as backup (some companies register a secondary entity in a crypto-friendly place like Switzerland or Dubai as a hedge, though if Hong Kong remains welcoming, this may not be necessary).
- Legal and Advisory Support: Retain a good law firm and compliance advisor on an ongoing basis. As you saw, regulations can be nuanced; having experts you can call will save headaches. Hong Kong has law firms specializing in crypto – many of which publish updates (we’ve even cited some!). They can assist with license applications, reviewing contracts (e.g. custody agreements, investor term sheets), and ensuring new initiatives (like launching a new product or token) won’t breach regulations. Also, leverage government resources: InvestHK’s CryptoHK initiative (if still active) helps crypto companies navigate licensing and banking. Don’t hesitate to engage with regulators directly – the SFC and HKMA have fintech liaison channels. If in doubt about how a rule applies, sometimes an informal inquiry can clarify things.
- Recent Developments to Leverage: Hong Kong’s positive crypto stance means there are often pilot programs or grants. For example, the HKMA’s sandbox might allow you to test a new product (like a cross-border payment using Bitcoin) with regulatory supervision but without full licensing immediately . The government is also courting talent – there are visa programs for fintech professionals if you need to hire from abroad. In late 2024, Hong Kong established a Task Force on Virtual Asset Development which recommended further initiatives to grow the sector (keep an eye on any outcomes, like perhaps government co-investing in crypto startups or streamlining licensing further). Hong Kong’s public investment funds have started to put money into crypto ETFs, etc., indicating growing acceptance.
- Ethical and Reputational Practices: Because crypto has had scams and bad actors, run your company with an emphasis on integrity. Avoid things like market manipulation, misleading marketing, or offering unrealistic guarantees. Not only would those invite regulatory action, they’ll harm Hong Kong’s reputation that the government is trying to build. If you become a significant player, the media and community will pay attention – being known as a compliant, security-minded, and community-engaged firm will pay dividends. Consider sponsoring or joining educational events, contributing to consultations, and generally being a good citizen in the ecosystem. This can indirectly help with regulatory goodwill and brand building.
Lastly, embrace Hong Kong’s vision: the city aims to be “the global benchmark for cryptocurrency hubs”, combining innovation with regulation . By following this guide – defining a solid business model, getting your entity set up, complying with SFC/MSO requirements, planning your market reach, structuring your funding smartly, leveraging the sweet tax benefits, and implementing sound banking and custody practices – you will be well on your way to establishing a successful Bitcoin treasury company in Hong Kong. Keep learning and adapting as the industry evolves. Hong Kong offers a fertile ground for crypto entrepreneurship, and with careful execution, your company could be part of the next wave of pioneers bridging traditional finance with the new world of Bitcoin and digital assets.
Sources:
- Hong Kong Companies Registry – Key steps to register a company
- Law&Trust (2020) – Crypto Exchange Licensing in Hong Kong (MSO requirements)
- Hauzen LLP (2025) – Guide to Money Service Operator Licensing
- HK Lawyer (2023) – SFC Virtual Asset Trading Platform License Requirements
- Nasdaq/Motley Fool (2025) – Crypto Treasury Companies and custody practices
- Skadden (2025) – Cryptoasset Treasury Strategies in Public Markets
- IRD/HKICPA (2023) – Taxation of Cryptocurrency Guidance (DIPN 39)
- Law.asia (2025) – Hong Kong’s Crypto Hub Regulatory & Tax Landscape
- Reuters (2023) – HKMA urging banks to support crypto firms
- Davis Polk (2025) – Hong Kong Stablecoin Licensing Regime Summary