The Hong Kong Monetary Authority (HKMA) announced today that new capital requirements for banks with engagements in crypto-assets will come into effect from January 1, 2026. The focus is particularly on investments in permissionless blockchain technologies, such as open networks like Bitcoin or Ethereum.
In the future, banks will need to maintain a capital ratio of 1:1 for such engagements. This means that for every dollar held in crypto, an equivalent dollar of equity must be provided. With this measure, the HKMA aims to ensure that risks from volatile markets do not jeopardize the stability of the banking sector.
While regulatory steps in Europe and the USA are currently often limited to specific application areas, Hong Kong is taking a clear path: Crypto engagements in the banking sector will be strictly secured. Analysts see this as a dual signal: On one hand, Hong Kong wants to maintain its position as an international crypto hub, while on the other hand, it aims to limit systemic risks posed by highly volatile assets.
This could have various effects on the market. Banks offering crypto services will have to hold significantly more capital in the future – which increases costs, but could also lead to greater trust and safety among institutional clients. It remains to be seen whether the stricter regulation will stifle innovation or lay the foundation for sustainable growth.
Sources: Economic Times
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