Hong Kong to Implement New Crypto Asset Banking Regulations in 2026

According to PANews, the Hong Kong Monetary Authority has issued a circular announcing the full implementation of new banking capital regulations based on the Basel Committee on Banking Supervision's crypto asset standards, effective January 1, 2026. In an interview with Caixin, Faith, a partner at King & Wood Mallesons and a lecturer at the University of Hong Kong's Faculty of Law, explained that the new regulations set a maximum risk weight of 1250% for crypto asset exposures using permissionless blockchain technology. This means banks must hold capital equivalent to at least a 1:1 ratio for these crypto asset exposures. Such stringent capital requirements are expected to deter many banks from holding these types of crypto assets.