Hong Kong is slowly opening the door for insurers to step into crypto — but it’s doing it very carefully.
The city’s insurance regulator has proposed new rules that could, for the first time, allow insurance companies to hold cryptocurrencies on their balance sheets. The idea isn’t to rush in, but to set clear limits and strong safeguards.
Under the proposal, any crypto held by insurers would come with a 100% risk charge. In simple terms, that means an insurer would need to keep extra capital equal to the full value of its crypto investment. Crypto would be allowed — but it would be expensive.
Stablecoins would be treated differently. Their capital requirements would depend on the fiat currency they’re linked to, as long as the issuer is licensed and regulated in Hong Kong.
This move fits into Hong Kong’s larger plan to grow regulated crypto activity while keeping financial risks under tight control.
According to a Bloomberg report dated December 22, this is the first time the Insurance Authority has clearly explained how insurers could legally hold crypto assets.
The regulator says the proposal is part of a wider review of its risk-based capital system. A public consultation is expected to run from February to April, with formal rules to follow later.
The plan also goes beyond crypto.
Insurers would get capital incentives for investing in infrastructure projects tied to Hong Kong or mainland China. That includes developments in the Northern Metropolis, a major project near the border with China.
Hong Kong has been looking for private money to help fund these projects as budget pressure grows. While the plan lines up with government goals, the Insurance Authority says it made the decisions on its own.
Not everyone is convinced yet.
Some businesses say too few projects qualify, and discussions are still ongoing. That means the rules could change before they’re finalized.
All of this is happening as Hong Kong continues to build a broader digital asset framework.
A new stablecoin licensing system launched in August. Issuers must hold at least HK$25 million in capital and fully back their tokens with liquid assets. The first stablecoin licenses are expected in early 2026.
Crypto activity in the city is already picking up. HashKey, Hong Kong’s largest licensed crypto exchange, listed shares this month. Tokenization trials are expanding, and regulated trading volumes are growing.
As of June, Hong Kong had 158 authorized insurers. The industry brought in around HK$635 billion, or $82 billion, in premiums in 2024.
Even small crypto or infrastructure investments from insurers could bring serious institutional money into the market. But the strict risk charges show one thing clearly — Hong Kong is moving forward slowly and cautiously, not throwing the doors wide open.
