Hong Kong Imposes 100% Capital Charge on Crypto Holdings for Insurers
Hong Kong's insurance regulator has unveiled a draft framework mandating a 100% capital charge on cryptocurrency holdings, marking a significant tightening of balance-sheet controls for digital assets. The move reflects growing regulatory scrutiny over volatility and liquidity risks in the crypto market.
Stablecoins receive differentiated treatment under the new rules, with capital requirements tied to licensing status and peg stability. Insurers are incentivized to shift focus toward infrastructure projects and regional growth initiatives through lower capital charges.
The regulatory overhaul positions Hong Kong as a leader in developing risk-based frameworks for digital assets. This aligns with the territory's broader strategy to establish itself as a regulated hub for cryptocurrency innovation while maintaining financial stability.
