HONG KONG (Dec. 25, 2025) — Hong Kong is accelerating its bid to become a tightly regulated, institution-friendly digital asset hub, outlining a path toward 2026 legislation that would bring virtual asset (VA) dealers and crypto custodians under a mandatory licensing regime. At the same time, the city’s insurance regulator is moving in parallel, weighing a capital framework that would allow insurers to hold crypto—but at a steep cost—while creating incentives for infrastructure allocations that align with government development priorities. ^[1]

Taken together, the moves signal a broader Hong Kong strategy: expand the regulatory perimeter beyond licensed trading platforms, harden investor protections and anti-money-laundering…