Hong Kong Proposes New Rules to Tap Insurance Capital into Cryptocurrencies
The Hong Kong Insurance Authority has proposed new rules allowing 158 authorized insurers to channel funds into digital assets, including cryptocurrencies. Under the proposal, insurers would face a 100% risk charge on direct crypto holdings, requiring them to hold a dollar reserve for each dollar invested. Stablecoins would incur risk charges based on the fiat currency to which they are pegged.
The details of the proposal were presented during a December 4 briefing cited by Bloomberg. Public consultation is planned for February to April 2025, with legislative submissions expected later in 2025. Additionally, the Hong Kong Monetary Authority is expected to issue the first stablecoin licenses in early 2026.
This move aims to unlock a multi-billion-dollar capital pool for digital assets and infrastructure and could mark a significant milestone for institutional crypto adoption in Asia.
