Hong Kong to finalise stablecoin rules and expand crypto tax breaks

The government of Hong Kong is progressing with its cryptocurrency regulations, focusing on establishing stablecoin frameworks and introducing new incentives to attract investors. 

At the recent Hong Kong Fintech Week, officials from the Hong Kong Monetary Authority (HKMA) and the Treasury announced that stablecoin regulations are expected to be finalised by the end of the year. 

Plans were also discussed for a 2025 consultation on over-the-counter (OTC) exchanges and other crypto-related matters.

Christopher Hui, Secretary for Financial Services and the Treasury, indicated that crypto assets might be eligible for tax incentives targeting family offices. 

This move is part of Hong Kong’s broader strategy to position itself as a key player in the Asian cryptocurrency landscape.

The Securities and Futures Commission (SFC) added that new guidelines for licensing virtual asset trading platforms (VATP) would soon be introduced. 

Currently, the SFC is conducting on-site reviews for 14 applicants. 

These companies are required to implement specific changes to receive a limited license, with a third-party review needed to secure a permanent operating license.

Earlier, SFC CEO Liang Fengyi highlighted the goal of establishing a complete crypto regulatory framework by next year. 

The regulations aim to create a secure and well-governed environment for digital asset trading in Hong Kong. 

However, some exchanges have opted out of the application process due to the city’s stringent regulatory requirements, leaving only three licensed crypto trading platforms actively operating in the region.