Hong Kong Insurance Authority Proposes Crypto and Infrastructure Investments for Insurers

Source: DefiPlanet Original Title: Hong Kong Insurance Authority Proposes Crypto and Infrastructure Investments for Insurers Original Link: https://defi-planet.com/2025/12/hong-kong-insurance-authority-proposes-crypto-and-infrastructure-investments-for-insurers/

Quick Breakdown

• The IA draft allows insurers to allocate capital to crypto, stablecoins, and infrastructure projects.
• Public consultation runs from February to April 2026; the framework aims to support economic growth and digital finance.
• Rules could open new investment avenues for insurers while reinforcing Hong Kong’s financial status.

Overview

The Hong Kong Insurance Authority (IA) has unveiled a draft proposal allowing insurers to allocate capital to cryptocurrencies, stablecoins, and infrastructure projects, potentially marking a first in channelling insurance funds toward government-prioritized sectors. Under the proposed rules, crypto assets would carry a 100% risk charge, while stablecoin investments would be assessed according to the pegged fiat currency.

The consultation period is scheduled for February through April 2026, after which the framework will undergo legislative review. A spokesperson for the IA emphasized that the risk-based capital framework is designed to support the insurance sector while contributing to broader economic development.

According to Bloomberg, the Hong Kong Insurance Authority is proposing a set of new rules to channel insurance capital into assets including cryptocurrencies and infrastructure. Under a presentation document, the regulator would apply a 100% risk capital charge to crypto assets.

Capital Incentives for Infrastructure

The draft framework also includes incentives for insurers investing in local infrastructure, including new towns and urban development projects such as the Northern Metropolis near the mainland border. This aligns with Hong Kong’s broader strategy to attract private capital for regional growth and strengthen its position as a leading digital finance hub. The IA noted that it operates independently from the government, though its framework complements public infrastructure initiatives.

Industry participants have suggested expanding the list of eligible infrastructure projects, noting that the current draft covers a limited scope. As of June 2025, Hong Kong hosted 158 authorized insurers, with total gross premiums reaching HK$635 billion ($82 billion). Meanwhile, the city’s central bank expects to grant the first stablecoin approvals early next year, reflecting Hong Kong’s growing focus on digital finance innovation.

Next Steps and Industry Impact

If finalized, the IA’s proposals could reshape how insurance capital is deployed across crypto and infrastructure markets. Public consultation will collect industry feedback before the framework is implemented. Observers suggest the rules could open new investment avenues for insurers, while reinforcing Hong Kong’s position as a hub for digital finance and large-scale infrastructure development. The initiative coincides with the government’s consultation on the Crypto-Asset Reporting Framework (CARF), which aims to improve tax transparency in the digital asset sector.