Hong Kong's Securities and Futures Commission (SFC) launched a regulatory framework on Monday for piloting ​the trading of eligible tokenized investment products ‌in the city, a statement showed.

The framework will mainly facilitate secondary trading of SFC-authorized open-ended funds on ​SFC-licensed virtual asset trading platforms, and will ​broaden retail investors' access to regulated trading ⁠services, the regulator said.

The move builds on the ​SFC's tokenization scheme introduced in November 2023 and aims ​to boost digital asset trading activity in Hong Kong, the SFC said.

New framework measures tackle issues such as ​investor protection and trading beyond regular trading ​hours of the underlying securities.

"This initiative allows a traditional securities ‌product, ⁠once tokenized, to be traded in the evening and on weekends, and supported by the use of regulated stablecoins and tokenized deposits to ​facilitate round-the-clock liquidity, ​satisfying ⁠demand of investors reacting to an increasingly fast-moving and uncertain market environment," ​said Julia Leung Fung-yee, the SFC’s chief ​executive officer.

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The ⁠initial batch of products traded under the framework is expected to focus on tokenized money market ⁠funds. ​The regulator may widen ​the scope of the product after reviewing trading operations.