The SFC approved secondary trading of two tokenised SFC-authorised money market funds, the ChinaAMC HKD Digital Money Market Fund and the ChinaAMC USD Digital Money Market Fund, on an SFC-licensed virtual asset trading platform. Trading runs around the clock and began on 26 October 2026. It is the first approval under the SFC's April 2026 circular on secondary trading of tokenised funds. The first batch covers only tokenised money market funds, and the SFC says it may broaden the product scope over time.
Why it matters: Round-the-clock trading gives tokenised money market fund units a use beyond parking cash, as collateral or a settlement asset. R.M.
For Ethereum: Hong Kong now has a route for whitelisted fund tokens on public chains such as Ethereum to reach retail trading, since the SFC allows public chains with added controls and has approved trading of tokenised funds on a licensed platform.
The Securities and Futures Commission (SFC) approved secondary trading of two tokenised SFC-authorised funds on an SFC-licensed virtual asset trading platform (VATP), available around the clock, which “began today”, 26 October 2026 (para 1). The funds are the ChinaAMC HKD Digital Money Market Fund and the ChinaAMC USD Digital Money Market Fund (Note 1), both from China Asset Management (Hong Kong) Limited. The release does not name the platform, the market maker or the chain. The SFC calls it “the world’s first secondary trading of tokenised public funds” (para 1).
The approval is made under the SFC’s 20 April 2026 circular, which the release describes as a framework “to pilot secondary trading of tokenised SFC-authorised funds” covering the trading channel, fair pricing, liquidity provision and disclosure (para 2, Note 2). Under that circular, an existing authorised product needs “prior consultation and approval from the SFC” before it adds these features, assessed case by case (paras 23 to 25).
The first batch is limited to tokenised money market funds. The SFC “will closely monitor the relevant trading activities” and “consider broadening the product scope over time” (para 5). It says tokenised funds could later use tokenised deposits from Project Ensemble, its joint work with the Hong Kong Monetary Authority (HKMA), for settlement of trading proceeds (para 3, Note 3).
Implications
Until now, holders of the ChinaAMC funds could only subscribe and redeem through distributors.
The SFC’s Executive Director of Investment Products, Elisa Ng, commented on the approval:
It puts the SFC’s regulatory framework through its paces and adds an important building block – 24/7 trading capability – to Hong Kong’s evolving tokenisation ecosystem. We will continue to strengthen Hong Kong’s position as a pioneer in tokenisation by facilitating responsible innovation while safeguarding investors.
The April circular asks product providers to use their best endeavours to arrange at least one market maker, and requires platforms to alert investors when a trade price deviates significantly from the fund’s indicative net asset value (NAV) and to remind them they can subscribe or redeem at NAV instead (circular paras 12, 15). The release names no market maker, so whether an independent one signed up is not public.
Secondary trading gives tokenised money market funds a use beyond parking cash. A holder can sell units at any hour instead of waiting for the fund to deal, so the units can serve as collateral or as a settlement asset. The SFC ties the step to settling trading proceeds in tokenised deposits under Project Ensemble (para 3). The collateral use rests on inference: no trading volume, spread or market maker has been disclosed, and the first volumes on the platform, along with applications from funds other than ChinaAMC’s, would show whether the demand exists.
For Ethereum
The SFC’s tokenisation circular lets product providers use public-permissionless blockchain networks only with “additional and proper controls”, such as a permissioned token (para 13). Trading under the April circular takes place on the platform under the VATP rules (circular paras 8 to 9). Read together, the two circulars and this approval give permissioned tokens on public chains a route to retail trading in Hong Kong, which supports the case for issuing tokenised funds on Ethereum with whitelists. This rests on inference: the release does not name the chain the funds use, and a published contract address or the platform’s disclosure of how a trade updates token holdings would confirm it.
Elsewhere in Asia
The State of Play entry on tokenised securities sets out the other markets. India’s Demat 2.0 pilot plans secondary trading in a later phase, on request-for-quote platforms. In Singapore, tokenised funds are sold through licensed distributors and platforms, mostly to accredited and institutional investors.
What to watch
Which platform lists the funds and who makes the market, the first tokenised fund other than a money market fund to apply, and settlement of trading proceeds in tokenised deposits under Project Ensemble.