In June 2025, Guotai Junan International (Stock Code: 1788.HK) made headlines after receiving approval from the Hong Kong Securities and Futures Commission (SFC) to upgrade its existing securities trading license to include virtual asset trading services. This strategic move transformed the firm into the first Chinese-owned securities company in Hong Kong with full-service capabilities in digital assets — triggering a market frenzy that sent its stock soaring by 198.39% in a single day.
But what exactly makes this license so powerful? And how could it reshape the future of finance across Asia and beyond?
What Is a Virtual Asset Service Provider (VASP) License?
A Virtual Asset Service Provider (VASP) is a regulated entity authorized to offer services related to digital assets, including cryptocurrencies like Bitcoin and Ethereum, stablecoins such as Tether (USDT), and tokenized financial instruments.
Under Hong Kong’s regulatory framework, companies providing virtual asset trading platforms must obtain proper licensing. Since June 1, 2023, all centralized crypto exchanges operating in Hong Kong — whether dealing with security tokens or non-security tokens — are required to hold a VASP license issued by the SFC.
To legally provide comprehensive virtual asset trading services, firms typically need:
- Type 1 License: Dealing in securities
- Type 7 License: Providing automated trading services
By upgrading its existing Type 1 license to include virtual asset trading permissions, Guotai Junan International has now gained the green light to offer clients direct access to trade major cryptocurrencies and stablecoins, while also distributing and advising on virtual asset-related products — including structured notes and over-the-counter derivatives.
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Early Mover Advantage: How Guotai Junan Built Its Digital Edge
While the recent license approval came as a surprise to many investors, Guotai Junan International had already been laying the groundwork for years.
Since early 2024, the firm has taken several strategic steps:
- Launched structured products linked to spot Bitcoin and Ethereum ETFs — among the first in Hong Kong.
- Secured SFC approval to act as an introducing agent for virtual asset trading platforms.
- In early 2025, received confirmation to distribute tokenized securities and began piloting digital bond issuance using blockchain technology.
This forward-looking strategy positioned Guotai Junan not just as a traditional broker, but as a bridge between conventional finance and the rapidly evolving world of decentralized digital assets.
Other financial players have followed suit. Firms like Futu Holdings, ZhongAn Online, and Interactive Brokers have also obtained VASP licenses, signaling growing institutional confidence in crypto’s long-term viability.
As Futu’s Managing Director Xie Zhijian noted, investor demand is surging:
“Since launching Bitcoin and Ethereum trading pairs against HKD and USD in August 2024, we’ve seen consistent growth in user participation. Client interest spans both crypto-native users diversifying into traditional markets and traditional investors exploring digital assets.”
Why This Matters: Reshaping the Non-Bank Financial Landscape
The implications of Guotai Junan’s VASP approval go far beyond one company’s success. Analysts believe it marks the beginning of a broader transformation across Asia’s financial ecosystem.
✅ Opening New Revenue Streams
Traditional brokerage fees are shrinking due to competition and digitization. Virtual assets offer a compelling alternative:
- Higher-margin trading commissions on crypto transactions
- Cross-border stablecoin settlement revenue, offering faster, cheaper alternatives to SWIFT
- Design and issuance fees for structured crypto derivatives and tokenized funds
These services not only boost profitability but also diversify income sources — reducing reliance on volatile equity markets.
✅ Building a Digital Financial Infrastructure
Hong Kong is actively positioning itself as a global hub for virtual assets. With full licensing, Guotai Junan can now participate in cutting-edge developments such as:
- Issuing regulated stablecoins
- Tokenizing real-world assets (RWA) like bonds, real estate, or private equity
- Creating programmable financial products that execute automatically via smart contracts
This positions the firm as more than a broker — it becomes a digital financial infrastructure provider, capable of connecting traditional capital with blockchain-based innovation.
✅ Catalyzing Industry-Wide Change
According to Dongwu Securities, Guotai Junan’s success proves that large Chinese financial institutions can navigate complex regulatory environments and deliver compliant digital asset services. This sets a precedent for other major players with Hong Kong subsidiaries — such as CITIC Securities, CICC, and China Merchants Securities International — to follow.
The shift isn’t just about adding crypto trading. It’s about redefining what a modern investment bank looks like:
| Old Model | New Model |
|---|---|
| Low-margin brokerage | High-value digital asset solutions |
| Domestic focus | Cross-border digital settlement networks |
| Passive custody | Active participation in tokenized finance |
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FAQs: Your Key Questions Answered
Q: What does the VASP license allow Guotai Junan International to do?
A: It enables the firm to legally offer cryptocurrency trading (e.g., Bitcoin, Ethereum), stablecoin services, advisory on digital assets, and distribution of tokenized products like ETFs and structured notes.
Q: Is this only relevant to Hong Kong investors?
A: No. While regulated in Hong Kong, the services can attract international clients seeking compliant access to digital assets through a trusted financial institution.
Q: How does this affect traditional stockbrokers?
A: It pressures them to innovate. Firms that fail to adopt digital asset capabilities risk losing high-net-worth clients and institutional business to more agile competitors.
Q: Are there risks involved in offering crypto services?
A: Yes — including market volatility, cybersecurity threats, and evolving regulations. However, being fully licensed under SFC oversight significantly reduces compliance and operational risks.
Q: Can other Chinese brokers get similar licenses?
A: Yes. The path has now been proven viable. Brokers with strong Hong Kong operations are expected to pursue similar upgrades in the coming months.
Q: Will this lead to more crypto ETFs or tokenized stocks?
A: Absolutely. With distribution rights and advisory permissions, firms like Guotai Junan are well-positioned to launch or promote new products such as tokenized bond funds, programmable dividends, or even fractional real estate tokens.
The Bigger Picture: A New Era of Financial Integration
Guotai Junan International’s breakthrough isn’t just a corporate milestone — it’s a signal of deeper structural change.
As highlighted by Huachuang Securities’ non-bank financial team, the convergence of traditional finance and blockchain technology is accelerating. The “1-license upgrade” model demonstrates that established institutions can evolve without sacrificing compliance or client trust.
Over time, we may see:
- Stablecoins replacing legacy payment rails for cross-border remittances
- Tokenized equities and bonds traded 24/7 on decentralized platforms
- AI-driven robo-advisors managing mixed portfolios of fiat and digital assets
The financial system is no longer siloed. Instead, it's becoming an interconnected network where value flows seamlessly across borders, asset classes, and technologies.
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Final Thoughts
Guotai Junan International’s VASP license is more than regulatory paperwork — it’s a strategic gateway into the future of finance. By embracing virtual assets early and securing full compliance, the firm has not only unlocked new revenue streams but also positioned itself at the forefront of Asia’s digital finance revolution.
For investors, analysts, and financial professionals alike, this moment serves as both a warning and an opportunity: the era of digital assets is no longer coming — it’s already here.
Core Keywords:
- Virtual Asset Service Provider (VASP)
- Guotai Junan International
- Hong Kong SFC license
- Crypto trading platform
- Tokenized securities
- Stablecoin settlement
- Digital asset integration
- Blockchain finance