OSL, a member of BC Technology Group, on December 15 was the first firm to become licensed by the Securities and Futures Commission (SFC) to conduct Type 1 (dealing in securities) and Type 7 (automated trading service (ATS)) regulated activities, and is now the world’s first SFC-licensed, listed, digital asset wallet-insured, Big-4 audited digital asset trading platform for institutions and professional investors.
The license, which permits OSL Digital Securities to operate regulated brokerage and automated trading services for digital assets, was granted after the company opted into the SFC’s virtual asset regime and successfully underwent the SFC’s rigorous vetting requirements.
Upon go-live, OSL Digital Securities will offer customers safe, secure and compliant trading access to Bitcoin (BTC), Ethereum (ETH) and other high-quality cryptocurrencies, along with select security token offerings (STOs).
The SFC applies the same heightened level of regulations already governing the securities markets to digital assets, making it one of the most comprehensive and investor-friendly jurisdictions for institutional and professional investors.
“Institutional investment in Bitcoin and other digital assets has rapidly accelerated over the past several years, and has entered a new era of growth in Hong Kong with licensing,” said OSL CEO Wayne Trench. “Because the framework is under the auspices of a leading global regulator and modeled after existing licensing for financial services, clients can trade with confidence under the protections and safeguards to which they are accustomed.”
In addition to traditional protection measures, OSL customers trading under the licenses will benefit from insurance protection on digital assets, including Bitcoin, held in client segregated wallets. Customers will undergo rigorous KYC and AML controls, and OSL will mitigate the risk of market misconduct through market surveillance, as well as transaction monitoring and additional digital-asset-specific controls.
“Licensed entities are the future of digital assets and capital markets in the digital age and professional investors, hedge funds and family offices are now rapidly increasing portfolio allocations to digital assets such as Bitcoin,” added OSL head of distribution and prime Matt Long.
In addition to the Hong Kong licenses, OSL has also applied to the Monetary Authority of Singapore for a digital asset license under the Payment Services Act.
The OSL digital asset platform business experienced exceptional growth and performance in 2019 and in the first half of 2020. In its interim results announcement on 12 August 2020, BC Group experienced a year-on-year revenue increase of 47%, driven mainly by record annualized trading volumes of $28 billion achieved during the first six months of the year.