Hong Kong has firmly positioned itself as a forward-thinking hub in the global virtual asset landscape. In a landmark development, the city approved its first investment immigration application backed by 30 million HKD worth of Ethereum (ETH) on February 7, 2025—following its earlier acceptance of Bitcoin (BTC) as valid proof of assets in October 2024. Two additional applicants holding BTC are currently in the process of applying, marking a series of breakthroughs that underscore Hong Kong’s progressive stance on cryptocurrency regulation and adoption.
According to萧耀和, a Hong Kong-based accountant handling these cases, applicants must hold qualifying digital assets, with a professional accountant issuing an audit report to verify asset value. Currently, only BTC and ETH are officially accepted for investment immigration purposes, though discussions around broader recognition of other major cryptocurrencies continue.
🔐 Crypto Investment Immigration: Requirements and Limitations
Asset Threshold and Investment Process
Under Hong Kong’s Capital Investment Entrant Scheme, applicants must demonstrate ownership of at least 30 million HKD in eligible assets—ranging from real estate and stocks to bonds. With its evolving regulatory openness, Hong Kong now permits equivalent-value cryptocurrency holdings to satisfy this requirement.
Applicants can store their crypto in cold wallets or use major exchanges like Binance to verify balances. Once asset verification is complete, they are required to invest the funds in designated financial instruments—typically Hong Kong-listed equities or bonds.
So far, successful applicants have used Bitcoin and Ethereum, both recognized for their market stability and widespread institutional acceptance.
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Practical Constraints in Application
Despite the progressive framework, several operational challenges remain:
• Proof of Fund Origin
While Hong Kong does not require full transaction history tracing (unlike Singapore), it does demand clear evidence of current asset legitimacy. Applicants lacking early trade records or those with holdings from defunct exchanges may face rejection due to insufficient documentation. Additionally, when using exchange-held assets, users must often first prove fund legitimacy to the platform—adding an extra layer of compliance burden.
• Limited Acceptance of Cryptocurrencies
Although BTC, ETH, AVAX, and LINK are legally recognized for sale and circulation in Hong Kong, only BTC and ETH have been accepted so far for investment immigration. The preference likely stems from their proven price stability and high liquidity. Other tokens may be considered on a case-by-case basis, but applicants should expect rigorous scrutiny.
• Renewal Costs and Ongoing Compliance
Approval isn’t permanent. After passing the initial audit, applicants must complete their investment within six months. They then receive a two-year visa, renewable upon demonstrating continued compliance:
- Minimum investment value of 30 million HKD must be maintained annually.
- Assets cannot be transferred or liquidated post-investment.
- Portfolio performance (profit or loss) is irrelevant—the principal value is what matters.
This creates a long-term commitment with significant administrative and financial overhead.
🏛️ Institutional Advantages: Tax Efficiency, Regulation, and Global Appeal
Beyond immigration pathways, Hong Kong offers a comprehensive ecosystem that supports crypto innovation through favorable taxation and clear regulatory frameworks.
1. Tax-Friendly Environment
Hong Kong’s tax regime is highly attractive to crypto investors and Web3 entrepreneurs:
- Territorial Taxation Principle: Only income sourced within Hong Kong is taxed. This benefits crypto traders and firms conducting cross-border activities.
- No Capital Gains Tax: Unlike the U.S. or UK, where capital gains taxes can reach up to 20–30%, Hong Kong imposes zero tax on capital gains, making it ideal for digital asset investors.
- Proposed Tax Relief for Family Offices: In November 2024, the government proposed tax exemptions for hedge funds and family offices investing in crypto assets. If enacted, this would further solidify Hong Kong as a prime destination for high-net-worth individuals managing digital wealth.
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2. Clear Regulatory Framework
Rather than adopting an all-or-nothing approach, Hong Kong has implemented a nuanced, risk-based regulatory model.
• Classification of Cryptocurrencies
Per the Inland Revenue Department’s DIPN39 guidance, cryptocurrencies are categorized into three types:
- Payment tokens (e.g., BTC, ETH)
- Security tokens
- Utility tokens
Each category faces tailored oversight, avoiding blanket restrictions while ensuring investor protection.
• Licensed Crypto Exchanges
Since 2023, all crypto trading platforms operating in Hong Kong must obtain a license from the Securities and Futures Commission (SFC). As of 2025, nine platforms have been officially licensed, enhancing market transparency and user security.
This licensing regime ensures platforms adhere to anti-money laundering (AML) standards, custody protocols, and fair trading practices—building trust among institutional and retail investors alike.
• Stablecoin Regulatory Sandbox
Hong Kong is actively shaping stablecoin policy. In March 2024, regulators proposed a regulatory sandbox to cautiously test fiat-referenced stablecoins (FRS).
Currently under legislative review, the Stablecoin Ordinance Bill aims to:
- Require licensing for all港元-backed stablecoins (regardless of issuer location).
- Enforce strict reserve requirements and redemption guarantees.
- Apply the principle of “same business, same risk, same rules” across domestic and foreign issuers.
These measures aim to minimize systemic risks while fostering innovation at the intersection of traditional finance and Web3.
🌐 Strategic Vision: Bridging Traditional Finance and Web3
Hong Kong’s approach to cryptocurrency is neither reckless liberalization nor rigid prohibition. Instead, it represents a balanced middle path—one that embraces innovation while maintaining financial integrity.
The acceptance of BTC and ETH for investment immigration signals more than policy flexibility; it reflects an official acknowledgment of digital assets as legitimate forms of wealth. Combined with transparent regulation and tax incentives, this creates a powerful “policy package” designed to attract global crypto talent and capital.
This synergy fosters a virtuous cycle:
- High-net-worth individuals relocate assets and residency.
- Crypto-native entrepreneurs establish businesses.
- Local exchanges, custodians, and fintech firms expand.
- Talent, capital, and industry growth reinforce each other.
Long-term, Hong Kong is leveraging crypto not just as an asset class—but as a strategic gateway to integrate its established financial infrastructure with the next wave of digital economy innovation.
Frequently Asked Questions (FAQ)
Q: Can I use USDT or other altcoins for investment immigration?
A: Not currently. Only Bitcoin (BTC) and Ethereum (ETH) have been approved for investment immigration applications. While USDT is widely used, it has not yet been accepted as proof of asset value in this context.
Q: Is there a requirement to pay taxes on crypto gains in Hong Kong?
A: No. Hong Kong does not impose capital gains tax, including on profits from cryptocurrency trading or holdings—making it one of the most tax-efficient jurisdictions globally for digital asset investors.
Q: Do I need to sell my crypto to qualify for immigration?
A: No. You do not need to liquidate your holdings. However, you must transfer the equivalent value (30 million HKD) into approved investments such as Hong Kong-listed stocks or bonds within six months of approval.
Q: How does Hong Kong verify crypto ownership?
A: Through professional audit reports issued by certified accountants. For exchange-held assets, platforms may require KYC and source-of-funds verification before providing official balance confirmation letters.
Q: Are family offices benefiting from new crypto policies?
A: Yes. A proposed legislative amendment aims to exempt family offices from taxes on crypto investments. If passed, this will make Hong Kong even more appealing to ultra-high-net-worth families managing digital portfolios.
Q: What’s the future outlook for stablecoins in Hong Kong?
A: Positive. With active development of a licensing framework for港元-backed stablecoins and a focus on consumer protection, Hong Kong is positioning itself as a leader in responsible stablecoin innovation.
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Hong Kong's journey into the crypto era exemplifies how a major financial center can evolve without compromising stability. By recognizing digital assets as valid capital, implementing smart regulation, and offering tax advantages, it has created a compelling model for other jurisdictions to follow—and a magnet for the future of finance.