PURPOSE OF THE ELECTRONIC PLATFORM TRADING RULES

1. OSL Digital Securities Limited (“OSLDS” or the “Company”) is licensed by the Hong Kong Securities and Futures Commission (“SFC”), to conduct regulated activities for Virtual Assets as follows:

a. Providing Automated Trading Services (“ATS”) including but not limited to the OSLDS trading platform, a “Type 7 Activity”; and

b. Providing electronic Facilitation Trading (“FT”), including, but not limited to, a Request for Quote (“RFQ”) platform (referred to as a “Flash Trade” on the platform), which constitutes a “Type 1 Activity”.

c. OSLDS provides these Electronic Platform Trading Rules to Users of OSLDS’s services, so that users are informed of how OSLDS and the ATS and FT Platforms operate.

d. The Electronic Platform Trading Rules set out the rules and requirements governing the operation of OSLDS’s ATS and FT Platforms, specifically to ensure that:

i. OSLDS complies with its obligations under the Securities and Futures Ordinance (“SFO”), and ancillary legislation;

ii. OSLDS is capable of cooperating with the SFC, as well as any applicable law enforcement authority;

iii. OSLDS’s role and authority in operating the ATS and FT Platforms, including its ability to amend these rules, or further make rules in relation to the OSLDS’s ATS and FT Platforms, is clear and transparent to Users;

iv. The operation of the OSLDS’s ATS and FT Platforms are fair to Users, and to help maintain an orderly and integrous market.

2. In order to maintain, apply and amend the Platform Trading Rules, OSLDS may establish any such committees or working groups that it considers necessary. OSLDS may appoint any person(s) or third parties to assist in the operation of the OSLDS’s ATS or FT Platforms.

PLATFORM TRADING RULES

3. OSLDS may publish such rules, requirements, decisions, direction, notices, circulars or similar instruments, as it considers necessary for the operation of its ATS or FT Platforms.

4. Any rules, requirements, decisions, direction, notices, circulars or similar instrument published under paragraph 3 will be effective from the date of publication, or such later date as may be specified at the time of publication.

5. If there is any inconsistency between paragraphs of these Trading Rules, such inconsistency may be resolved by a decision of OSLDS, in its sole and absolute discretion. Where any paragraph of these Rules is inconsistent with any more specific agreement between OSLDS and a User, the terms of the agreement shall prevail over these Rules. Users must read these Rules in conjunction with any terms and conditions of the Client Agreement which have been agreed between a User and OSLDS.

6. The laws of the Hong Kong Special Administrative Region (“HKSAR”) shall govern OSLDS’s affairs, and each User of OSLDS’s services agrees to submit to the non-exclusive jurisdiction of the courts of the HKSAR. These Electronic Platform Trading Rules are not intended to operate in a way which is inconsistent with the provision of any legislation or regulation, and in the event of any inconsistency, the laws of the HKSAR prevail.

7. Subject to the obligations of OSLDS to notify the SFC under the terms and conditions of its licence, or under the Code of Conduct for Licensed Persons prior to implementation, OSLDS may, either (i) upon application by a User or party, or (ii) on its own motion, vary or waive any provision of these Electronic Platform Trading Rules by publishing a notice of such variation or waiver.

8. Subject to the obligations of OSLDS to notify the SFC under the terms and conditions of its licence, or under the Code of Conduct for Licensed Persons prior to implementation, OSLDS may revise these Electronic Platform Trading Rules, either by varying an existing rule (including deleting a rule), or by adding additional rule(s), at its sole and absolute discretion. For the avoidance of any doubt, OSLDS may vary or add rules without notifying any User before it makes such a decision.

9. If the Electronic Platform Trading Rules are varied in accordance with paragraph 8, OSLDS will cause the revised Electronic Platform Trading Rules to be published on its website, and the revised Electronic Platform Trading Rules will be effective from the date of such publication. It is the responsibility of Users to make themselves aware of the Electronic Platform Trading Rules each time they use OSLDS’s ATS or Facilitation Trading (“FT”) Platforms.

COOPERATION WITH REGULATORS AND LAW ENFORCEMENT

10. OSLDS will cooperate with any lawful request from a regulator or law enforcement official.

11. OSLDS may be required to make notifications to a regulator or law enforcement official, including details about User(s) and/or a User’s ATS or FT activity.

ADMISSION AND REMOVAL OF VIRTUAL ASSETS TO OSLDS’S PLATFORM

12. OSLDS may admit any virtual asset to ATS or FT Platforms.

13. Any admission of virtual assets to ATS or FT Platforms (including where such assets are created by way of Fork, Airdrop or other Network Event), will be in compliance with OSLDS’s virtual assets admission criteria published on ATS and/or FT websites.

14. OSLDS may also remove any virtual asset which is available through OSLDS’s ATS or FT Platforms, at its sole and absolute discretion, provided however that when doing so OSLDS shall, where practicable given any security concerns or Network Events:

a. Give notice of its intention to remove the virtual asset;

b. Suspend trading of the virtual asset in an orderly manner;

c. Allow Users to withdraw any balance of the virtual asset for a specified period.

TRADING THROUGH THE ATS OR FT PLATFORM

15. OSLDS will provide its ATS and FT Platforms to clients who are eligible, in accordance with the following provisions.

a. Eligible Users

i. Clients of OSLDS are eligible, upon appropriate qualification and meeting requirements to adequately pre-fund their trading account, to use the ATS and OSLDS’s other services including automated FT.

b. The ATS and OSLDS’s other services are subject to qualification based upon, inter alia:

i. Any required client suitability and risk assessment methodology, which may restrict products or services that the User has access to; and

ii. Qualification of the User as a Professional Investor, within the meaning of Schedule 1 of the Securities and Futures Ordinance, or the Securities and Futures (Professional Investor) Rules.

OPERATING HOURS AND ORDER TYPE DEFINITIONS 

ATS

Except in the instance of Outages or Halts (as described below), or otherwise in anomalous market conditions, OSLDS’s ATS is intended to operate 23.5 hours a day, 7 days a week.

There will be regularly scheduled maintenance windows of no more than 30 minutes unless otherwise published. All maintenance periods will be published on the ATS website and all users on the ATS will be given notice ahead of the maintenance window commencing through OSLDS’s website.

The ATS will accept orders from Users at all times whilst the ATS is in operation.

ATS ORDER DEFINITIONS:

Limit Orders

A limit order is a Buy or Sell order at a given quantity and price, which is defined as a Good until Cancel order type (“GTC”). 

Market Orders

A market order is a Buy or Sell order for a specific quantity at the best prevailing price. 

Fill-and-Kill (“FAK”)     

A Fill and Kill order is an immediate Buy or Sell order with a specific quantity and price. If there are no matches in price, the order will be automatically withdrawn. If there are price match(es) but not sufficient quantity in the order depth, it will partially fill the order and the remaining quantity will be automatically withdrawn. 

(Collectively, these orders are “Eligible ATS Orders”).

AUTOMATED CLIENT FACILITATION TRADING ORDERS:

RFQ 

An RFQ is a client Request for Quote which comprises a side and quantity or value of one or more approved virtual assets. The FT response is an automatically generated quotation valid for a predefined period, unless withdrawn. Refer to the client agreement for further information.

ATS EXECUTION METHODOLOGY:

Participants, User Priority and Client Order Handling

Users whose Eligible ATS Orders are accepted will be placed into the Exchange order book, where the Exchange’s logic evaluates orders on a price, category and time priority basis.     

Explicitly, orders within the order book are prioritised by the following rules (the “Sorting Rules”):

1. Price
2. Category - Client orders are prioritised over Principal orders
3. Arrival time of orders at the same price level

Order Types

Maker Order is an incoming order that is entered into the order book in accordance with the Sorting Rules above.

Taker Order is an incoming order that results in a resting order being immediately filled, whether partially or in full. The remaining order that is unfilled is entered into the order book as a Maker Order.

Limit Orders

When a limit order is received the Exchange will check the opposite side of the sorted order book to try and match this order. If there are no matches on price, then the limit order will be placed into the order book as a resting order in a position sorted as per the above sorting rules. 

If there are price match(es) but not sufficient quantity in the order book to fill the entire order, the Exchange will partially fill the limit order and the remaining quantity will be placed in the order book in a position sorted as per the above Sorting Rules. If there are price match(es) and sufficient quantity the limit order will be fully filled. 

Market Orders

When a market order is received the Exchange will check the sorted order book for the closest price to match this order and fill the order on infinite price levels until the quantity is fully filled. 

If there is not enough liquidity/quantity in the order book, then the market order will be partially filled and the remaining amount will be withdrawn. 

Fill-and-Kill (“FAK”) 

When a Fill-and-Kill order is received, the Exchange will check the opposite side of the order book to try and match the order. If there are no matches in price, the order will be withdrawn. 

If there are price match(es) but not sufficient quantity in the order book, the FAK order will be partially filled and the remaining quantity will be withdrawn. 

If there are price match(es) and sufficient quantity, the FAK order will be fully filled.

ELECTRONIC FACILITATION TRADING ORDERS

Accepted FT Orders are, unless specifically agreed in writing with OSLDS, facilitation trades to which “best execution” principles do not apply.

Clients may, via the FT Platform accessed through a web interface or API (Application Programming Interface), request a quote based on the quantity of the virtual asset(s) or the total value (expressed in fiat or virtual asset value). A quote may be returned and is valid for acceptance for a defined period of time. Once the quote acceptance period expires, the User may manually, or the system may at OSLDS’s discretion, automatically re-quote based on the initial order parameters, and a new quote acceptance period will commence. 

While still in the quote acceptance period, the User may accept the quote by selecting “confirm” and the trade will then be automatically executed. The User will be notified of the successful execution.

OSLDS may (at its sole discretion) impose limits on FT orders, including on a per quote basis, and a maximum daily notional basis.

ATS Order Routing and Order Cancellation

Users may access the ATS Platform directly, either through the web interface, or via API.

All Eligible ATS Orders are executed on ATS Platform. There is no routing of orders to external trading venues.

When Eligible ATS Order(s) are cancelled, they are cancelled in order of the arrival of the cancellation request(s). Orders and cancellations for the same trading instrument are processed in order of arrival.

CONTROLS - GENERAL PRINCIPLES

OSLDS has implemented controls to ensure the fair and orderly functioning of the ATS, including:

i. Development, testing and monitoring of the ATS;

ii. Monitoring of the technology infrastructure by the Technology Department;

iii. Monitoring of execution and settlement by the Operations Department;

iv. Supervision and surveillance of the ATS by the Compliance Department.

Instrument Controls

In order to maintain an orderly market, the ATS includes the following controls which can be configured per Virtual Asset pair.

Min Price - The minimum price allowed for a single order.

Max Price - The maximum price allowed for a single order.

Min Quantity - The minimum quantity allowed for a single order.

Max Quantity - The maximum quantity allowed for a single order.

Min Value - The minimum value allowed for a single order.

Max Value - The maximum value allowed for a single order.

Self-trade Prevention

Users are not able to place an order which would result in self-execution, i.e. where the same User would act as both the maker and taker for a trade. If two orders would result in self-execution, the resting order(s) that would self-trade with the incoming order will be withdrawn and the incoming order will also be withdrawn.

MARKET MANIPULATION PROHIBITED

Users are prohibited from engaging in any form of Market Manipulation. Market Manipulation is defined as actions taken by any market participant or a person acting in concert with a participant which are intended to:

• Deceive or mislead other Users;
• Artificially control or manipulate the price or trading volume of [any Virtual] Asset; or
• Aid, abet, enable, finance, support, or endorse either of the above. This may include actions on or outside of OSLDS’s platforms.

Market Manipulation specifically includes, without limitation: front-running, wash trading, spoofing, layering, churning, “pump-and-dump” and quote stuffing. 

Fills and Settlement

When a Maker Order is matched with a Taker Order, both orders are filled. An order may be matched with and filled by one or more orders at the same price.

OSLDS settles all filled orders automatically, by debiting and crediting the relevant balances of virtual assets and fiat currencies in both Users’ accounts.

Subject to daily withdrawal limits a User may withdraw all virtual assets and fiat currencies in their accounts.

TRADING FEES

OSLDS charges a maker fee for each Maker Order and a taker fee for each Taker Order that is posted to the Order Book. The fee is charged in the quoted asset and is calculated as a percentage of the order size. A fee is charged by debiting the User’s balance for the amount of the fee at the time that the order is posted.

Fees will be refunded if the order is cancelled.

OUTAGES AND HALTS

ATS

OSLDS may suspend the ATS in specific instruments or the entire system, for regulatory compliance reasons, technology-related reasons, network events, or where OSLDS believes that suspension is necessary to ensure market integrity or otherwise protect the interests of Users of the ATS or OSLDS’s services.

In case of:

• a market suspension, or 
• technical reasons that:

  • prevent or degrade Users’ ability to place or cancel Orders, or
  • prevent or degrade access to OSLDS’s APIs or the Platform User Interfaces, or 
  • affect the operation of the order books or matching engines, 

then OSLDS may, in its discretion, take one or more of the following actions in respect of one or more order books:

• temporarily disable depositing or withdrawing of virtual assets;
• cancel open orders;
• disable sign-in;
• disable API connectivity;
• disable access to the Platform User Interface;
• disable the ability to place new orders (Cancel-Only Mode);
• If the ATS service is in Cancel-Only mode, it will be restored to fully operational only after access through the Platform User Interface becomes available for at least 5 minutes and OSLDS deems it safe to restore the platforms to fully operational;
• OSLDS will notify Users of the move to or from Cancel-Only Mode via the ATS Status Page or notification via email.

These actions may be taken to protect clients, and the ATS from anomalous external price movements; this would be to prevent a disorderly market arising upon reopening the ATS. 

PLANNED EVENTS:

Notification of any planned trading suspensions will be published on the ATS’ web-site status page, with a description of the suspension and an expected time for resumption of the ATS. 

Where there is a Network Event including a Fork, OSLDS, at its discretion, will ordinarily suspend trading in the affected instrument(s), and may, following the Network Event, choose to support one or more of the chains resulting from the Fork.

FT

OSLDS may suspend or withdraw the automated FT facility (RFQ) through its platform User Interface or via API for regulatory compliance reasons, technology-related reasons or for network events. In the event of a suspension of the service, users would be notified through either a statement on the platform User Interface or via a system generated warning message.  

Circuit Breakers

OSLDS does not use circuit breakers or automated trading halts based on predetermined price bands.

Access to Information

All Users have full and equal real-time access to Market Data, which is made available through the Web Interface or APIs.

Market Data comprises the following:

• All Limit Orders placed on the Order Book (price, quantity, and time);
• All canceled Orders on the Order Book (price, quantity, and time);
• All Fills or Executions (price, quantity, and time).

Market Data does not include any information about which User placed or canceled an order.

API documentation, test environment details and requirements are available on the Company’s website.

Potential Risks

Users should refer to the Client Agreement signed with OSLDS for the applicable Risk Disclosures.

Complaints

Clients may refer to the following page for details on how to submit and escalate a complaint:

https://www.osl.com/hk-Hans/support/how-to-escalate-a-complaint