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Hong Kong proposes new rules to tap insurance capital into cryptocurrencies
Public consultation on the proposal will occur from February to April, with legislative submissions expected later in the year.
Updated Dec 25, 2025, 10:57 a.m. Published Dec 22, 2025, 7:28 a.m.
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What to know:
- Hong Kong is considering new rules to allow insurers to invest in digital assets, potentially boosting institutional crypto adoption in Asia.
- The proposal mandates a 100% risk charge on direct crypto holdings, requiring insurers to reserve a dollar for every dollar invested.
- Public consultation on the proposal will occur from February to April, with legislative submissions expected later in the year.
Hong Kong is plotting a move to unlock a multi-billion dollar capital pool for digital assets and related infrastructure, potentially marking a watershed moment for institutional crypto adoption in Asia.
The Hong Kong Insurance Authority (IA) is proposing new rules that would allow the city’s 158 authorized insurers to channel funds into assets, including cryptocurrencies, according to a Dec. 4 presentation seen by Bloomberg.
STORY CONTINUES BELOW
While the proposal signals an institutional thaw toward crypto, the regulator is still keeping its guard up with a conservative risk framework. The proposal requires insurers to keep aside a dollar in reserve for every dollar invested in crypto, representing a 100% "risk charge" on direct crypto asset holdings. This is a heavy capital requirement mandated as buffer against digital assets' renowned volatility.
Stablecoins, however, would attract risk charges based on the fiat currency they are pegged to, the Bloomberg report said. The Hong Kong Monetary Authority is expected to issue first stablecoin licenses in early 2026.
The industry won't have to wait long for a formal look at the text as the Insurance Authority is set to open the proposal for public consultation from February through April, followed by legislative submissions later in the year.
CORRECT (Dec. 25, 10:55 UTC): Corrects the timing of the public consultation throughout. An earlier version of this story said it would occur from February to April 2025.
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