Hong Kong Police Force has established the Virtual Assets Intelligence Team (VAIT) in collaboration with licensed institutions such as Sinohope Technology. This public-private partnership aims to strengthen anti-fraud efforts in the virtual asset space through intelligence sharing and a "cash stoppage mechanism" to crack down on scams effectively.

Amid Hong Kong’s active embrace of Web3 and its goal to become a global digital asset hub, virtual asset-related scams are rising sharply, causing significant losses to investors. Recently, licensed virtual asset service provider Sinohope issued an urgent alert warning investors about scammers impersonating its representatives to defraud funds. Simultaneously, the Hong Kong Police’s Cyber Security and Technology Crime Bureau (CSTCB) has taken strong action by establishing the VAIT, aiming to enhance detection and prevention of virtual asset crimes through public-private cooperation. These measures highlight Hong Kong's firm stance against crypto scams and signal that in the Web3 era, criminals’ operational space will be increasingly squeezed.

1. Sinohope’s Urgent Warning: Beware of Fake Scams and Protect Investor Assets

As a licensed entity holding HK Securities and Futures Commission (SFC) licenses for Class 1, 4, and 9 regulated activities, Sinohope recently received reports indicating that scammers are impersonating the company to deceive investors into transferring funds or making deposits.

• Scam Tactics： Scammers exploit Sinohope’s brand influence by impersonating its staff or representatives, contacting investors through unofficial channels, and inducing them to transfer funds or make deposits.

• Official Clarification and Tips： Sinohope emphasizes that it will never ask clients for transfers or deposits through unofficial channels. All communication with clients will only be conducted via official website announcements. Investors who are approached by anyone claiming to be Sinohope staff outside official channels should refrain from sharing personal or financial information.

• Help & Verification： Sinohope advises investors to consult the Hong Kong SFC warning list and call the Hong Kong Police’s “Fraud Prevention Hotline” 18222 if they suspect scams. To verify the identity of Sinohope representatives, investors can contact Sinohope’s official Twitter account (@SinohopeGroup).

This urgent warning serves as a reminder to investors: always verify information through official channels and stay vigilant against fraud in the virtual asset sector.

2. Hong Kong Police Launch Major Action: Establishment of VAIT

To respond to the escalating virtual asset crime situation, the Hong Kong Police Cyber Security and Technology Crime Bureau (CSTCB) held the Web3 Intelligence and Enforcement Summit on October 10 and officially launched the Virtual Assets Intelligence Team (VAIT).

• Composition & Mission of VAIT： VAIT is led by the Hong Kong Police, involving law enforcement agencies, financial regulators, and licensed virtual asset service providers. Its core mission is to enhance detection and prevention of virtual asset crimes and cyber threats through intelligence sharing and collaborative mechanisms.

• Serious Crime Trends： Police Commissioner Chow Ming-kam stated that in the first eight months of the year, there were 1,463 virtual asset-related cases, including 15 hacking attacks on Web3 institutions, with losses amounting to approximately HKD 990 million. These figures underscore the prevalence and severe impact of virtual asset crimes.

• Public-Private Collaboration： The establishment of VAIT aims to promote the compliant and secure development of the virtual asset ecosystem, strengthen market integrity, and safeguard assets. This reflects Hong Kong’s proactive approach to integrating government, regulators, and industry players in combating virtual asset crime.

3. Security Measures by Security Bureau: "Stop Payment" Mechanism – Cutting Off Fraud Transfer Paths

The formation of VAIT aligns with the "stop payment" mechanism proposed earlier by Security Secretary Chris Tang, working together to create a multi-layered defense against virtual asset crimes.

• New Fraud Transfer Routes： On September 23, Tang mentioned that scams involving virtual assets have increased, with some cases previously involving bank transfers now shifting to virtual asset platforms.

• Establishing "Stop Payment" with Platforms： The Security Bureau has set up the VAIT and partnered with virtual asset platforms to implement the "stop payment" mechanism. Tang emphasized that virtual asset service providers must have this mechanism in place—if a scam occurs and funds are still held on the platform, similar to banking protocols, the platform should freeze these funds to prevent further transfer.

This mechanism aims to effectively halt the transfer of stolen funds, maximally recover victim assets, and serve as a strong deterrent against cybercriminals.

4. Security Challenges and Responses in the Web3 Era: Compliance & Technology

The warnings from Sinohope and the actions by Hong Kong authorities highlight the complex security challenges faced in Web3:

• Anonymity & Cross-border Nature： Virtual assets’ pseudonymity and cross-border transnational flow make it easier for criminals to conceal identities and transfer funds, complicating law enforcement efforts.

• Technological Complexity： Blockchain, cryptography, and other advanced technologies involved in virtual assets demand higher technical capabilities from law enforcement agencies.

• Regulatory Trend： As an international financial hub, Hong Kong is committed to building a safe, transparent, and compliant digital asset market. The operation of licensed institutions and active regulatory oversight are fundamental to healthy development of Web3.

Conclusion：

The urgent warning from Sinohope and the establishment of VAIT demonstrate Hong Kong’s resolute stance in combatting virtual asset crimes. These measures signal a decisive response to escalating scams and underline Hong Kong’s commitment to creating a secure, transparent, and compliant digital asset market. In the Web3 era, innovation and security must go hand in hand. With ongoing regulatory improvements and strengthened enforcement, the space for crypto scams will shrink, fostering a healthier and more sustainable market environment in Hong Kong.

Related Reading： Jack Ma's Entry into the Cryptocurrency Insurance Sector: Key Signals to Watch