Hong Kong has emerged as a global frontrunner in virtual asset regulation, making bold strides to integrate cryptocurrency into its financial ecosystem. 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 earlier approvals using Bitcoin (BTC). This milestone underscores Hong Kong’s growing openness to digital assets and signals a strategic shift toward attracting high-net-worth individuals from the Web3 space.
The successful cases were facilitated by professional accountants who verified the applicants’ crypto holdings through formal valuation reports. Currently, only BTC and ETH are accepted as valid proof of assets for investment immigration, although other major cryptocurrencies like AVAX and LINK are legally recognized for trading and circulation. The move reflects Hong Kong’s balanced approach—embracing innovation while maintaining regulatory rigor.
Crypto Investment Immigration: Eligibility and Practical Constraints
Asset Requirements and Application Process
Under Hong Kong’s Capital Investment Entrant Scheme, applicants must demonstrate ownership of at least 30 million HKD in qualifying assets, which can include real estate, stocks, bonds, or now, cryptocurrencies. With the updated policy, investors can use BTC or ETH held in cold wallets or verified by leading exchanges such as Binance to meet the threshold.
Once asset verification is complete, applicants are required to invest the same amount into designated financial instruments—typically Hong Kong-listed equities or debt securities—within six months. Upon successful investment, they receive a two-year visa, renewable if they continue to meet the criteria.
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Key Operational Limitations
Proof of Fund Origin
While Hong Kong does not require a full transaction history like Singapore, applicants must still prove legal ownership of their current assets. Missing records or funds linked to defunct exchanges may raise red flags. Additionally, when using exchange-held assets, users often need to first verify the legitimacy of their deposits with the platform—a step that adds complexity to the process.
Approved Cryptocurrency Types
Only BTC and ETH have been successfully used in approved applications so far. Despite AVAX and LINK being legally tradable, their acceptance for immigration purposes remains uncertain and subject to individual case assessment. Industry experts suggest that market stability plays a crucial role—BTC and ETH’s established price history likely contributes to their preferential treatment.
Renewal and Ongoing Compliance
The visa is not permanent. After the initial two-year period, renewal requires proof that the investment remains intact and valued at no less than 30 million HKD. While capital losses do not disqualify applicants, the requirement to maintain asset integrity introduces an ongoing compliance burden.
Why Hong Kong Stands Out: Tax Advantages and Regulatory Clarity
Beyond immigration policies, Hong Kong offers a comprehensive framework that supports crypto innovation while ensuring investor protection and financial stability.
Favorable Tax Environment
- Territorial Tax System: Hong Kong taxes only income sourced within the region. This benefits crypto investors and firms engaged in offshore trading or decentralized finance (DeFi) activities.
- No Capital Gains Tax: Unlike jurisdictions like the U.S. or U.K., which impose capital gains taxes up to 20%, Hong Kong does not levy such taxes. This makes it particularly attractive for long-term digital asset investors.
- Proposed Tax Incentives for Family Offices: In November 2024, the government introduced a proposal to exempt crypto investments held by family offices and hedge funds from taxation. If enacted, this would further solidify Hong Kong’s status as a premier destination for wealth management in the digital age.
Clear and Adaptive Regulatory Framework
Classification of Digital Assets
According to 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 is subject to tailored regulatory oversight, avoiding blanket restrictions and enabling nuanced policy implementation.
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 granted licenses, ensuring transparency, anti-money laundering compliance, and investor safeguards.
Stablecoin Regulatory Sandbox
Hong Kong is advancing cautiously on stablecoin regulation. A draft Stablecoin Ordinance is under legislative review, proposing a licensing regime for all fiat-backed stablecoins pegged to the Hong Kong dollar—regardless of where they’re issued. The framework emphasizes reserve transparency, redemption rights, and risk mitigation, aligning with the principle of “same business, same risk, same rules.”
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Building a Sustainable Web3 Hub: The Bigger Picture
Hong Kong’s approach to cryptocurrency is neither permissive nor restrictive—it’s strategic. By officially recognizing BTC and ETH as legitimate forms of wealth, the city affirms their status beyond speculative instruments. This symbolic validation, combined with clear regulations and tax efficiency, creates a powerful incentive for global Web3 talent and capital to relocate.
The ultimate goal is clear: to build a self-reinforcing cycle of talent → capital → industry growth. As more crypto entrepreneurs establish residency, local startups, exchanges, and service providers gain momentum. Traditional financial institutions also benefit by integrating blockchain-based services, fostering synergy between legacy finance and decentralized innovation.
Moreover, Hong Kong’s model offers a blueprint for other financial centers seeking to balance innovation with oversight. It demonstrates that regulatory clarity—not deregulation—is the key to sustainable Web3 adoption.
Frequently Asked Questions (FAQ)
Q: Can I use any cryptocurrency for Hong Kong investment immigration?
A: Currently, only Bitcoin (BTC) and Ethereum (ETH) have been approved for successful applications. While other coins like AVAX and LINK are legal for trading, their use in immigration cases is not yet standardized.
Q: Is there a capital gains tax on crypto profits in Hong Kong?
A: No. Hong Kong does not impose capital gains tax, making it highly favorable for long-term crypto investors and trading firms.
Q: Do I need to sell my crypto to qualify for investment immigration?
A: Not necessarily. You can use your BTC or ETH as proof of assets, but you must convert an equivalent value into approved financial instruments—such as Hong Kong stocks or bonds—after approval.
Q: How often do I need to renew my visa?
A: The initial visa is valid for two years. Renewal requires proof that your investment remains intact and meets the 30 million HKD threshold.
Q: Are offshore crypto earnings taxable in Hong Kong?
A: Generally no. Hong Kong follows a territorial tax system, meaning only income sourced within the region is taxed.
Q: What happens if my crypto portfolio drops below 30 million HKD?
A: As long as you maintain the required investment in approved assets, temporary market fluctuations won’t affect your eligibility. However, you must still prove the original asset value at application.
Hong Kong’s embrace of cryptocurrency extends far beyond symbolic gestures. Through structured immigration policies, tax incentives, and forward-looking regulation, it is positioning itself as a global gateway for Web3 innovation. For digital asset holders seeking both legitimacy and opportunity, the city offers one of the most compelling environments in the world today.
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