Victory Securities suspends virtual currency trading functions for users identified as Mainland China

Hong Kong Victory Securities officially ceased all virtual currency trading functions for users with mainland China identities starting in the afternoon of February 9, 2026, retaining only withdrawal privileges. This is Victory Securities’ final measure to gradually tighten services for mainland users, following restrictions implemented since December 19, such as banning purchases from mainland IP addresses and suspending new address verification. The move aims to comply with regulatory requirements from the Hong Kong Securities and Futures Commission and relevant mainland policies. Users who are not mainland tax residents are unaffected.

Three-Stage Tightening: The Complete Timeline from Opening to Closure

Victory Securities’ restrictions on mainland China users did not happen overnight but went through three clear phases of tightening. This gradual restriction strategy reflects both the escalating regulatory pressure and the platform’s attempt to balance compliance with business interests.

The first phase occurred on December 19, 2025, when Victory Securities notified that virtual asset accounts identified as originating from mainland China IP addresses were subject to a “buying prohibition.” According to reports from HK01, this move was in response to recent strengthened regulations on virtual asset trading in mainland China, aiming to close loopholes allowing mainland IPs to participate in trading. This initial restriction was relatively mild, only prohibiting new buy operations; users could still sell holdings and withdraw assets. Notably, this restriction also applied to Hong Kong customers using mainland IPs, meaning even legitimate Hong Kong residents connecting from mainland China would trigger the restriction.

The second phase involved suspending new address verification. Victory Securities stopped offering new virtual asset account openings for users with mainland China identities and limited the verification of new withdrawal addresses for existing users. This measure effectively prevented users from circumventing regulations through new addresses and laid the groundwork for a complete shutdown of trading functions.

The third phase was the full shutdown on February 9, 2026. According to Techub News, Victory Securities officially closed all virtual currency trading functions for users with mainland China identities, leaving only withdrawal privileges and no longer supporting deposits or new trades. This marked the end of mainland users’ crypto journey on the platform, with the only option being to quickly withdraw assets to other wallets or exchanges.

Victory Securities’ Three-Stage Timeline of Tightening

December 19, 2025: Prohibit buying from mainland IPs; selling and withdrawals still available

End of 2025 to early 2026: Suspend new address verification; restrict fund transfer flexibility

February 9, 2026: Fully close trading functions; only withdrawal channel remains

This three-phase approach was relatively user-friendly, providing ample time for users to adjust their asset allocations. However, for many mainland users who relied heavily on Victory Securities as their primary trading platform, it was a significant blow. Many expressed disappointment and dissatisfaction on social media, criticizing the platform for quickly changing after obtaining licensing and showing a lack of respect for early supporters.

From a compliance perspective, Victory Securities’ decision was not entirely voluntary. As a special administrative region of China, Hong Kong must balance international standards with mainland policies in financial regulation. Since 2021, mainland China has fully banned cryptocurrency trading and has intensified efforts to crack down on offshore platforms serving mainland clients. Under this context, continuing to serve mainland users with a Hong Kong Securities and Futures Commission license could risk license revocation.

From RWA Pioneer to Gate Closure: An 8-Month Dramatic Shift

Victory Securities’ policy shift toward mainland users has attracted widespread attention partly because of its prior active stance in RWA and crypto innovation. On April 28, 2025, HK01 reported that Victory Securities announced it had obtained two key virtual asset business approvals from the Hong Kong SFC: permission to offer full discretionary account management services for virtual assets to retail and professional investors, and approval to provide virtual asset trading services. This made Victory Securities one of the first traditional securities firms in Hong Kong to receive comprehensive virtual asset licenses.

A more dramatic development occurred on August 6, 2025. According to Sina Finance, Cao Cao Mobility and Victory Securities signed a strategic cooperation memorandum on virtual assets. The two parties would collaborate deeply on RWA tokenization, stablecoin payment applications, and compliant digital currency issuance. This marked the first systematic exploration within China’s travel industry of integrating RWA and stablecoins. Cao Cao CEO Gong Xin stated that blockchain technology and Web3.0 innovations would accelerate the asset tokenization of the Robotaxi industry.

From obtaining licenses in April, signing strategic cooperation in August, to restricting mainland IPs in December and fully closing mainland user trading in February—this rapid policy reversal within just 10 months was remarkable. The swift change may stem from multiple pressures: increased regulatory scrutiny from the Hong Kong SFC on licensed institutions serving mainland users, intensified crackdowns by mainland regulators on capital outflows, and upgraded international AML oversight on cross-border crypto transactions.

The irony of the RWA cooperation with Cao Cao Mobility now stands out. RWA tokenization and stablecoin payment scenarios mainly target enterprises and institutional clients, not retail investors. Victory Securities may be adjusting its strategy—abandoning high-risk retail crypto trading (especially for users in sensitive regulatory regions) and focusing on more compliant institutional RWA services. This shift aligns with the Hong Kong Monetary Authority’s “institution-first” strategy.

Hong Kong’s Dual-Track Crypto Policy Dilemma

Victory Securities’ case reveals the complex dilemma of Hong Kong’s crypto regulation. On one hand, the government actively promotes Hong Kong as an “Asian crypto hub,” introducing a leading VASP licensing regime to attract international crypto firms. On the other hand, as a Chinese SAR, Hong Kong must respect mainland China’s crypto ban to prevent becoming a conduit for mainland capital to evade regulation.

This dual-track approach puts licensed institutions in a tough spot. Serving mainland users offers access to a large market and high trading volumes but risks violating mainland regulations and jeopardizing licenses. Abandoning the mainland market means losing a major user base and limiting business scale. Victory Securities’ choice reflects a common trend among licensed firms in Hong Kong: prioritizing license security under regulatory pressure, even at the expense of growth.

Currently, non-mainland tax residents can still use Victory Securities’ crypto trading services normally. This includes Hong Kong residents, overseas Chinese, and international investors. Affected users can continue withdrawing assets to other platforms; Victory Securities has not frozen or confiscated user funds. From this perspective, the platform’s restriction measures are relatively moderate and maintain basic business ethics.

However, this incident has negatively impacted Hong Kong’s image as an “Asian crypto center.” Mainland users are a vital part of the Asian crypto market. If licensed Hong Kong institutions cannot serve this group, the city’s positioning as an Asian hub is weakened. More crypto firms may shift to jurisdictions like Singapore or Dubai with clearer regulatory environments.

From an investor protection standpoint, Victory Securities’ phased restrictions provided a buffer period. Starting in December with IP restrictions, then full closure in February—users had about two months to transfer assets. Compared to platforms that directly freeze accounts, this approach is relatively gentle. Still, active users relying on the platform for daily trading faced real losses, including forced liquidation of open positions, missed market opportunities, and the time cost of learning new platforms.

Future Divergence of Hong Kong’s Crypto Industry

Victory Securities’ case hints at a possible future split in Hong Kong’s crypto industry. Retail-focused trading platforms will likely face ongoing regulatory pressure, especially regarding serving mainland users. Conversely, platforms focusing on institutional services—such as RWA tokenization, enterprise stablecoins, and compliant digital asset custody—may find greater development opportunities.

This divergence aligns with global fintech trends. Western regulators are cautious about retail crypto trading but relatively open to blockchain applications in traditional finance. To maintain its status as a financial hub, Hong Kong may need to make clear strategic choices between retail and institutional sectors. Victory Securities’ rapid shift from active RWA exploration to closing retail trading exemplifies such strategic realignment.

For mainland Chinese investors, Victory Securities’ event underscores the risks of relying on licensed centralized platforms. Future developments may see more Hong Kong or overseas licensed institutions shutting down services to mainland China under regulatory pressure. The ultimate solution might involve turning to decentralized exchanges (DEXs) or self-custody wallets, despite increased technical complexity and security responsibilities, to avoid disruptions caused by platform policy changes.