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Hong Kong insurance regulator is exploring new rules that could allow insurance companies to invest in crypto and infrastructure.
Author: Sahil Thakur
Published On: Mon, 22 Dec 2025 05:53:39 GMT
22nd December 2025 – Hong Kong insurance regulator is exploring new rules that could allow insurance companies to invest in crypto and infrastructure. The move is part of a broader plan to modernize the city’s financial system and channel capital toward government-prioritized sectors.
According to a proposal shared in a December 4 presentation, the Insurance Authority plans to impose a 100% risk charge on crypto assets. This means insurers would need to back their entire crypto exposure with capital, making such investments possible, but capital-intensive.
Stablecoins, on the other hand, would face risk charges tied to the fiat currency they are pegged to, but only if the issuer is regulated in Hong Kong.
The regulator said this proposal is part of a larger review of its risk-based capital regime, with the goal of aligning insurance investment policies with the city’s broader economic development efforts. The rules are expected to undergo public consultation between February and April 2026, followed by formal legislative review.
In addition to crypto, the framework encourages insurers to invest in infrastructure projects tied to Hong Kong or mainland China. These include new towns, such as the Northern Metropolis, which the government hopes to develop into a major tech hub bordering mainland China.
The regulator proposes capital incentives for insurers who invest in infrastructure that aligns with local development plans. Despite this alignment, the Insurance Authority insists it operates independently from the government.
Although the rules would represent a significant shift, they reflect a cautious strategy. Requiring full capital coverage for crypto minimizes potential instability, especially for volatile assets. This could limit widespread adoption by insurers but also signals the start of institutional crypto exposure in Hong Kong.
At the same time, Hong Kong continues to build out its digital asset framework. A stablecoin licensing regime came into effect in August 2025, requiring issuers to hold at least HK$25 million in capital and maintain full asset backing. The first licenses are expected in early 2026.
Elsewhere in the city, regulated crypto exchanges like HashKey are growing, while tokenization pilots and trading volumes continue to rise.
Hong Kong is home to 158 licensed insurers, generating HK$635 billion ($82 billion) in gross premiums in 2024. Even limited exposure under these proposed rules could bring meaningful institutional capital into crypto and infrastructure.
However, concerns remain. Some firms argue that too few infrastructure projects currently qualify, and others are watching closely to see if the crypto rules change before final approval.
Still, this proposal marks an important step in Hong Kong’s bid to become a leading digital finance hub, while balancing innovation with financial risk.
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Hong Kong proposes new law allowing insurers to invest in crypto Hong Kong is proposing new rules that could allow insurers to invest in crypto, with full capital backing required and tight regulatory controls.
The Hong Kong Insurance Authority is proposing a slate of new rules to channel insurance capital into assets including cryptocurrencies and infrastructure https://t.co/9gfuoU0YaU
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