Bloomberg: Hong Kong plans to introduce new regulations for insurance companies' investments in crypto assets and infrastructure

The Hong Kong Insurance Authority has proposed new regulations aimed at guiding insurance funds into the fields of crypto assets and infrastructure. According to a presentation document dated December 4, the regulator intends to impose a 100% risk capital requirement on crypto assets, while the risk capital requirement for stablecoin investments will be determined based on the fiat currency to which the stablecoin is pegged.

The Hong Kong Insurance Authority stated that it has initiated a review of the risk capital regime this year, with the primary goal of supporting the insurance industry and broader economic development. The proposal is expected to undergo public consultation from February to April next year, followed by legislative submission.

In addition, the new regulations also involve incentives for infrastructure investment, proposing capital benefits for investments in infrastructure projects linked to Hong Kong, mainland China, or infrastructure projects (such as the development of new towns like the Northern Metropolis). As of 2024, the total premium income of the Hong Kong insurance industry is approximately HKD 635 billion.