Victory Securities, a licensed crypto broker in Hong Kong, has permanently disabled trading and deposit functions for users identified as residents of Mainland China. The firm announced that these users can no longer buy or trade virtual currencies on its platform, marking the final step in a multi-phase strategy to distance its digital asset services from the Mainland Chinese market.
The brokerage clarified that it is not freezing assets, and affected users retain "withdrawal-only" privileges to recover their existing holdings. The platform remains fully operational for local Hong Kong residents and international investors. Victory Securities had previously paused new address certifications and banned the purchase of specific tokens for the mainland market as part of this gradual withdrawal.
The decisive move comes amidst intensifying regulatory pressure from both Hong Kong and Mainland Chinese authorities. Days prior to the announcement, the People's Bank of China (PBoC) expanded its ban on issuing offshore tokens and the use of yuan-linked stablecoins in international markets. This has placed Hong Kong-based virtual asset service providers (VASPs) in a precarious position.
Under Hong Kong's Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO), VASPs face "strict liability" if found to be "actively marketing" prohibited services to mainland residents. The Hong Kong Securities and Futures Commission (SFC) now requires brokers to conduct rigorous due diligence on client residency. The risk of losing a hard-won VASP license is a primary motivator, as platforms must avoid becoming a "backdoor" for mainland capital to bypass China's capital controls.
The regulatory environment is further tightened by the Hong Kong Monetary Authority's (HKMA) implementation of the Stablecoin Ordinance, which became a regulated activity on August 1, 2025. Given that stablecoins are a primary entry point for many mainland users, brokers are under intense pressure to prevent "gray market" funds from entering the Hong Kong financial system.
The crackdown is partly a response to illicit activities, as illustrated by a recent case in Anhui province. There, a suspect involved in crypto trading since 2020 was arrested for acting as a virtual currency acceptor in a scam that defrauded a victim of 260,000 yuan, highlighting the perceived risks that regulators are aiming to mitigate.
