How Does Hong Kong Allow 24/7 Trading of Tokenised Funds?
On 20 April 2026 Hong Kong's Securities and Futures Commission issued two circulars permitting secondary trading of tokenised SFC-authorised investment products through SFC-licensed virtual asset trading platforms, with over-the-counter arrangements available case by case. Trading may run continuously across evenings, weekends and public holidays, settled using fiat-referenced stablecoins licensed under the Stablecoins Ordinance and tokenised deposits. The framework initially covers tokenised money market funds, with discretion to widen the scope. Its substance lies in the safeguards: at least one market maker per fund quoting continuously under a three-month termination notice, price deviation alerts against a net asset value refreshed at least every 15 seconds, and trading band controls with cooling-off periods. This guide covers what the circulars permit, the obligations they impose, and how the design differs from the US approach.
TL;DR — Key Takeaways
- ✓What Opened: Secondary trading of tokenised SFC-authorised products via licensed VATPs, from 20 April 2026 — plus case-by-case OTC arrangements.
- ✓Around the Clock: Continuous trading across evenings, weekends and public holidays, settled in Stablecoins Ordinance-licensed fiat-referenced stablecoins and tokenised deposits.
- ✓Liquidity Is Mandated: At least one market maker per fund, quoting continuously even when the underlying assets are not trading, on a minimum three-month termination notice.
- ✓Price Discipline: Price deviation alerts against a NAV refreshed at least every 15 seconds, plus trading band controls with cooling-off periods.
- ✓The Scale So Far: About HK$10.7 billion across 13 public tokenised products as of March 2026 — roughly sevenfold growth in a year, starting from a small base.
Solving the Constraint That Actually Binds
The SFC's two circulars of 20 April 2026 permit investors to trade tokenised SFC-authorised products between themselves through licensed virtual asset trading platforms, continuously, settled in regulated stablecoins. That addresses the limitation that has capped tokenised fund utility everywhere: a holder could subscribe and redeem through the product provider and had no way to exit in between.
It is worth being precise about why this matters more than it sounds. Most tokenised fund launches have delivered a token that cannot be transferred — the Irish UCITS case approved a few months later is explicitly mint-and-redeem only. Non-transferability makes regulatory approval far easier and leaves the instrument with essentially the operational profile of the fund it mirrors. Hong Kong took the harder path and permitted transfer, which means it had to answer the questions non-transferability lets you avoid.
The framework permits 24/7 secondary trading and authorises the use of regulated stablecoins — fiat-referenced stablecoins issued under a licence granted under the Stablecoins Ordinance — as well as tokenised deposits, to facilitate round-the-clock settlement.
— Analysis of the SFC's 2026 circulars on tokenised investment products
The settlement asset is the enabling piece. Continuous trading is meaningless if the cash leg waits for a bank to open, so the framework had to license a settlement instrument that operates on the same schedule as the trading venue.
What the Circulars Permit
Secondary trading runs through SFC-licensed virtual asset trading platforms under their existing operating rules, with over-the-counter arrangements negotiated directly between parties permitted case by case. The pilot focuses initially on tokenised money market funds, and the SFC retains discretion to expand the product scope after operational review.
| Element | Position under the framework |
|---|---|
| Venue | SFC-licensed VATPs, following existing operating rules; OTC case by case |
| Product scope | Tokenised money market funds initially, expandable at SFC discretion |
| Trading hours | Continuous — evenings, weekends and public holidays |
| Settlement asset | Stablecoins Ordinance-licensed fiat-referenced stablecoins and tokenised deposits |
| Liquidity provision | At least one market maker per fund, continuous quoting, three-month minimum termination notice |
| Distribution | SFC-licensed distributors able to handle creation and redemption requests |
Key Insight
Starting with money market funds is a deliberate risk choice, not a limitation of ambition. A money market fund has a stable, frequently struck NAV and highly liquid underlying assets, which makes it the easiest instrument on which to operate a price deviation control — you can tell quickly and confidently when a trade has printed away from fair value. Try the same framework on a fund holding illiquid or infrequently valued assets and the reference price itself becomes uncertain, at which point deviation alerts have nothing reliable to measure against. The product scope follows from what the safeguards can actually police.
The Safeguards Are the Design
Permitting continuous trading in a fund creates a specific problem: for most of those hours the underlying assets are not trading, so there is no contemporaneous market to anchor the price. The framework answers this with a mandated quoting obligation and two price controls rather than by restricting when trading may occur.
Continuous market making
At least one market maker per tokenised fund, obliged to quote continuously even when the underlying assets are not actively trading. This is the substantive answer to overnight and weekend pricing — someone is contractually required to make a two-sided price when no reference market exists.
Three-month termination notice
The market maker arrangement carries a minimum three-month notice period, so the obligation cannot evaporate without warning and leave a continuously quoted product with no quotes.
Price deviation alerts
Platforms must flag execution prices departing significantly from real-time NAV, which must refresh at least every 15 seconds. The refresh rate is what makes the control meaningful — a stale reference price cannot detect a deviation.
Trading bands and cooling-off
Band controls with cooling-off periods limit excessive movement and manipulation, which matters most in thin overnight sessions where a small order can move a price a long way.
Disclosure carries the remainder. Offering documents and online interfaces must address liquidity risk, price deviation, price fragmentation across channels and reliance on market makers, and investors must confirm they understand these before onboarding. Naming market maker reliance explicitly is notable — the framework requires the investor to be told that continuous liquidity depends on a commercial arrangement rather than on natural two-sided flow.
Two Regimes, Opposite Bets
Hong Kong and the United States approved tokenised trading within weeks of each other and chose opposite designs. The US kept the existing market structure and made tokenisation a settlement election; Hong Kong changed the market structure and built new controls to hold it together.
| Hong Kong (April 2026) | United States (March 2026) | |
|---|---|---|
| Instrument | Tokenised authorised funds, initially money market | Listed equities and ETFs in tokenised form |
| Trading hours | Continuous, 24/7 | Exchange hours, same order book as ordinary shares |
| Settlement | Licensed stablecoins and tokenised deposits | T+1 through DTC, unchanged |
| Venue | Licensed VATPs, plus OTC case by case | The existing exchange |
| Core bet | New venue and settlement asset, with new safeguards | Existing infrastructure, tokenisation as a settlement option |
Neither is obviously right. The US design preserves surveillance, fungibility and existing clearing at the cost of delivering no improvement in settlement speed; the Hong Kong design delivers genuine round-the-clock liquidity at the cost of depending on mandated market making and a new settlement asset. The US structure is examined in how tokenized stocks trade on Nasdaq, and the two are worth reading together as a natural experiment in how much market structure tokenisation actually requires.
Who Can Use It, and Where It Could Fail
The framework suits managers of authorised money market funds with Hong Kong distribution who can fund a market making arrangement and operate a real-time NAV feed. The market has some scale behind it — roughly HK$10.7 billion across 13 public tokenised products as of March 2026, about sevenfold growth in a year — though from a small base.
Prerequisites
- An SFC-authorised product in scope
- At least one market maker under contract
- Real-time NAV at 15-second refresh or better
- SFC-licensed distributors handling creation and redemption
Practical frictions
- Only around a dozen VATPs hold SFC licences
- Market making has a real cost to fund
- Continuous NAV production is an operational lift
- OTC arrangements are case by case, not automatic
Where it could fail
- A market maker exits and none replaces it
- Weekend prices detach from Monday's NAV
- Liquidity fragments across venues and channels
- A settlement stablecoin comes under stress off-hours
The last item is the dependency the framework creates and cannot fully control. Settling weekend trades in a licensed stablecoin means the trading venue inherits that issuer's operational and redemption profile precisely when conventional backstops are closed — a species of the dependency problem examined in whether the tokenized RWA market is too concentrated.
How Blockmaze Supports Continuous Trading
Continuous trading removes the overnight window in which most compliance reconciliation happens. A framework where transfers can occur at three in the morning on a public holiday needs eligibility, records and valuation to work without a batch cycle behind them.
Eligibility Without a Batch Window
Holder eligibility resolves at the point of transfer rather than in an overnight process, so a weekend trade is checked to the same standard as a Tuesday one.
Valuation Feed Recorded
The NAV source and its update cadence are recorded against the instrument, so the reference price a deviation alert measures against is auditable rather than assumed.
Continuous Transfer Record
Transfers, refusals and holder changes are retained as they occur, which is what supervision of an always-open venue requires in place of end-of-day reporting.
Settlement Asset Declared
Which stablecoin or tokenised deposit settles a given trade is recorded, so exposure to a settlement asset is measurable rather than an operational assumption.
The through-line is that 24/7 markets remove the pause conventional compliance was built around. Controls that ran nightly have to run continuously, which is less a matter of speed than of where the control sits — at the point of transfer rather than in a process that inspects transfers afterwards.
Launching a Continuously Traded Tokenised Fund?
Blockmaze provides the compliance layer that resolves eligibility at the point of transfer without a batch window, records the valuation feed behind price controls, and keeps a continuous transfer record.
Frequently Asked Questions
What did the SFC permit in April 2026?
On 20 April 2026 the SFC issued two circulars — an updated Circular on Tokenisation of SFC-authorised Investment Products and a new Circular on Secondary Trading of Tokenised SFC-authorised Investment Products. Together they permit investors to buy and sell tokenised authorised products between themselves through SFC-licensed virtual asset trading platforms, with case-by-case over-the-counter arrangements also available. The framework enables continuous round-the-clock trading across evenings, weekends and public holidays, and initially focuses on tokenised money market funds with SFC discretion to widen the scope after operational review.
How does settlement work outside banking hours?
Through regulated stablecoins and tokenised deposits. The framework authorises the use of fiat-referenced stablecoins issued under a licence granted under Hong Kong's Stablecoins Ordinance, alongside tokenised deposits, to facilitate settlement throughout extended hours. This is the mechanism that makes 24/7 trading coherent rather than aspirational: a trade executed on a Sunday needs a settlement asset that also works on a Sunday, and conventional payment rails do not. Licensing the settlement asset is what allows the trading window to detach from banking hours.
What stops a tokenised fund trading away from its NAV?
Two mandated controls plus a liquidity requirement. Trading platforms must operate price deviation alerts triggered when an execution price departs significantly from real-time net asset value, which must be updated at least every 15 seconds, and trading band controls with cooling-off periods to limit excessive movement and manipulation. Separately, each tokenised fund must have at least one market maker quoting continuously — including when the underlying assets are not themselves trading, which is precisely the overnight and weekend situation the framework creates.
What obligations fall on the fund manager?
Product providers must arrange at least one market maker per tokenised fund, with a minimum three-month termination notice period on that arrangement. Distributors must be SFC-licensed and able to handle creation and redemption requests. Offering documents and online interfaces must address liquidity risk, price deviation, price fragmentation across channels and reliance on market makers, and investors must confirm they understand those risks before onboarding. Firms must also disseminate real-time NAV and maintain a dedicated online trading interface.
Why does the three-month market maker notice period matter?
Because a market maker withdrawing without notice would leave a continuously quoted product with no quotes, in a venue open at hours when nothing else is. The notice period converts what would be an abrupt liquidity failure into a managed transition, giving the product provider time to replace the arrangement or wind down secondary trading in an orderly way. It is a small provision that reveals how the SFC has thought about the failure mode specific to 24/7 markets: the risk is not price movement but the disappearance of the party obliged to quote.
How large is the Hong Kong tokenised product market?
As of March 2026, tokenised fund assets under management reached approximately HK$10.7 billion across 13 products offered to the public, representing roughly sevenfold growth over the prior year. The scale is modest against the global tokenised Treasury market but the growth rate is steep, and the secondary trading framework is aimed at the constraint that limits it — an investor in a tokenised fund could previously only subscribe and redeem through the product provider, with no way to exit between dealing points.
Related Articles
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