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Hong Kong plans crypto, infrastructure capital rules for insurers
The Hong Kong Insurance Authority is planning new rules to direct insurance capital into cryptocurrencies and infrastructure, according to a presentation seen by Bloomberg.
The regulator proposes a 100% risk charge for cryptocurrency assets held by insurers, while stablecoin investments would face risk charges based on the relevant fiat currency.
A public consultation on the proposals is set for February to April 2026, with legislative steps to follow.
The rules would also offer capital incentives for insurers investing in infrastructure projects in Hong Kong or mainland China, aiming to support local development efforts such as the Northern Metropolis.
Some insurers are seeking broader coverage for more types of infrastructure projects under the proposed framework, sources said.
As of June 2024, Hong Kong had 158 authorized insurers with total gross premiums of about HK$635 billion (US$82 billion).
🔗 Source: Bloomberg
🧠 Food for thought
Implications, context, and why it matters.
Crypto’s 100% risk charge may align with existing high-risk asset treatment
- A 100% charge can require capital equal to insurers’ crypto in the Prescribed Capital Amount 1. The PCA spans market and insurance risk. It also includes counterparty default, other risk, and operational risk. It targets 99.5% one year solvency. Under Hong Kong’s Risk-Based Capital regime, only Unlimited Tier 1 counts without limits 2. Limited Tier 1 is capped at 10% of the PCA. Tier 2 is capped at 50%.
- Equity stress uses shocks with countercyclical buffers 3. A 100% crypto charge puts virtual assets in the top bucket. Stablecoins are crypto tokens pegged to government money. Tying charges to fiat treatment can make them more capital efficient 4. Insurers may favor HKMA licensed stablecoins that are exempt from some VATP track record rules 4.
Capital-efficient crypto custody creates demand for specialized infrastructure
- On 3 November 2025 the SFC issued circulars that expand Virtual Asset Trading Platform (VATP) activities and shared liquidity arrangements (interconnected order books) 4. The SFC permits staking by VATPs and SFC authorised Virtual Asset (VA) funds with prior approval 5. Intermediaries must use segregated accounts at VATPs or authorised banks and keep risk and disclosure controls 5. Under proposed licensing, the SFC would set standards while the HKMA would supervise banks and stored value facility (SVF) licensees for VA custody 6.
