Crypto May Enter Insurers’ Portfolios as Hong Kong Reviews Capital Rules

Hong Kong’s insurance regulator is reportedly reviewing its risk-based capital framework, potentially allowing insurers to allocate capital to cryptocurrencies and related infrastructure assets.

Key Developments

■ Insurers may be allowed to invest in crypto with a 100% capital charge, requiring capital equal to the full value of the crypto exposure

■ The proposal is part of a broader review aimed at supporting industry stability and economic development

■ Public consultation is expected after industry feedback is assessed

Why a 100% Risk Charge Matters

■ Treats crypto as a high-risk asset, limiting excessive exposure

■ Enables participation while maintaining prudential safeguards

■ Aligns closely with similar proposals from EU insurance regulators

Insurance Adoption Is Gaining Momentum

■ MassMutual bought $100M in BTC in 2020 — now worth nearly 5×

■ Allianz invested in a Bitcoin-focused convertible note structure

■ Tabit Insurance raised $40M in BTC to support traditional policies

Hong Kong’s Broader Crypto Strategy

■ Fintech 2030 roadmap emphasizes tokenization and real-world assets

■ Stablecoin regulations went live in August

■ Increasing contrast between Hong Kong’s openness and mainland China’s restrictions

Bottom Line

Hong Kong’s move signals that crypto is shifting from fringe allocation to regulated balance-sheet asset, even in conservative sectors like insurance — though under strict capital discipline.