Hong Kong Introduces New Regulations for Insurers on Crypto and Infrastructure

The Hong Kong Insurance Authority is proposing a slate of new rules to channel insurance capital into assets including cryptocurrencies and infrastructure — an unprecedented move that would redirect funds to government-prioritized sectors.

The insurance regulator plans to impose a 100% risk charge on cryptoassets, as outlined in a presentation on December 4, which was reviewed by Bloomberg News. Investments in stablecoins would incur risk charges based on the fiat currency to which the Hong Kong-regulated stablecoin is pegged, according to the document.

This proposal, which is still subject to change, will be open for public consultation from February through April, followed by legislative submissions.

In a statement to Bloomberg News, the regulator indicated that it has initiated a review of the risk-based capital regime this year, with the primary objective of supporting the insurance industry and broader economic development.

“We are at the stage of gauging industry feedback and will also put the proposals for public consultation in due course,” a spokesperson for the regulator stated.

Hong Kong has been actively constructing a framework to support the development of cryptoassets and stablecoins as part of its strategy to become a leading digital finance hub. The city’s de facto central bank anticipates granting the first batch of stablecoin approvals early next year.

The insurer framework also addresses infrastructure, as Hong Kong seeks new avenues for growth. For infrastructure investments, the regulator proposes capital incentives for projects located in Hong Kong or the mainland, as well as those listed or issued in the financial hub. Eligible projects include new towns and urban area developments in the city, such as the Northern Metropolis. One of the goals of this proposal is to bolster the government’s initiatives for local infrastructure development, as highlighted in the presentation.

Facing a deficit, the Hong Kong government is striving to attract private capital to assist in building the Northern Metropolis, an area bordering the mainland that aims to become a tech hub. The insurance regulator has emphasized that it operates independently of the government.

Some firms are submitting feedback with hopes of expanding the coverage to a broader range of infrastructure projects, as the current framework offers limited options, according to sources familiar with the matter who requested anonymity due to the private nature of the discussions.

As of June, there were 158 authorized insurers in the city. Together, the total gross premiums of the Hong Kong insurance industry amounted to approximately HK$635 billion ($82 billion) in 2024.

Photograph: Hong Kong has been actively building a framework to support the development of crypto assets and stablecoins as part of its strategy to become a top digital finance hub. Photo credit: Paul Yeung/Bloomberg

Copyright 2025 Bloomberg.

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The Hong Kong Insurance Authority is proposing a slate of new rules to channel insurance capital into assets including cryptocurrencies and infrastructure — an unprecedented move that would redirect funds to government-prioritized sectors.

The insurance regulator plans to impose a 100% risk charge on cryptoassets, as outlined in a presentation on December 4, which was reviewed by Bloomberg News. Investments in stablecoins would incur risk charges based on the fiat currency to which the Hong Kong-regulated stablecoin is pegged, according to the document.

This proposal, which is still subject to change, will be open for public consultation from February through April, followed by legislative submissions.

In a statement to Bloomberg News, the regulator indicated that it has initiated a review of the risk-based capital regime this year, with the primary objective of supporting the insurance industry and broader economic development.

“We are at the stage of gauging industry feedback and will also put the proposals for public consultation in due course,” a spokesperson for the regulator stated.

Hong Kong has been actively constructing a framework to support the development of cryptoassets and stablecoins as part of its strategy to become a leading digital finance hub. The city’s de facto central bank anticipates granting the first batch of stablecoin approvals early next year.

The insurer framework also addresses infrastructure, as Hong Kong seeks new avenues for growth. For infrastructure investments, the regulator proposes capital incentives for projects located in Hong Kong or the mainland, as well as those listed or issued in the financial hub. Eligible projects include new towns and urban area developments in the city, such as the Northern Metropolis. One of the goals of this proposal is to bolster the government’s initiatives for local infrastructure development, as highlighted in the presentation.

Facing a deficit, the Hong Kong government is striving to attract private capital to assist in building the Northern Metropolis, an area bordering the mainland that aims to become a tech hub. The insurance regulator has emphasized that it operates independently of the government.

Some firms are submitting feedback with hopes of expanding the coverage to a broader range of infrastructure projects, as the current framework offers limited options, according to sources familiar with the matter who requested anonymity due to the private nature of the discussions.

As of June, there were 158 authorized insurers in the city. Together, the total gross premiums of the Hong Kong insurance industry amounted to approximately HK$635 billion ($82 billion) in 2024.

Photograph: Hong Kong has been actively building a framework to support the development of crypto assets and stablecoins as part of its strategy to become a top digital finance hub. Photo credit: Paul Yeung/Bloomberg

Copyright 2025 Bloomberg.

Topics
Carriers