Hong Kong Set to Propose New Digital Asset Regulatory Framework

Hong Kong authorities are preparing to propose significant legislative measures aimed at strengthening the territory’s position in the digital asset industry. The Legislative Council Financial Affairs Committee has scheduled a policy briefing for January 30, where Financial Services and Treasury Bureau officials—including Secretary Christopher Hui and Deputy Secretary Joseph Chan—will outline the government’s comprehensive regulatory agenda. The briefing signals Hong Kong’s commitment to fostering sustainable development within the crypto sector while maintaining its status as a leading international financial center.

Proposed Legislative Measures and OECD Alignment

The government intends to propose new amendments to the crypto asset reporting framework and align Hong Kong’s standards with common reporting guidelines established by the Organization for Economic Cooperation and Development (OECD). These legislative proposals will be formally submitted throughout 2026, reflecting a strategic effort to modernize Hong Kong’s regulatory environment. The framework is designed to enhance transparency and ensure that digital asset transactions comply with international best practices in financial reporting and disclosure standards.

Automatic Tax Information Exchange Framework

A key component of the proposed measures involves implementing an automatic tax information exchange mechanism with other tax jurisdictions starting in 2028. This system will enable authorities to systematically share data related to crypto asset transactions, creating a coordinated approach to combat cross-border tax evasion. By establishing this framework, Hong Kong aims to strengthen international tax cooperation and contribute to global efforts in closing tax loopholes that have historically enabled offshore financial activities.

Stakeholder Engagement and Industry Impact

Currently, the government is actively collecting public opinions and feedback on the legislative proposals before finalizing the regulatory framework. This consultative approach reflects efforts to balance oversight with industry development needs. The measures are expected to enhance investor protection, ensure fair market conditions, and position Hong Kong as a jurisdiction that combines robust financial regulation with openness to digital asset innovation. By proposing these forward-looking policies, Hong Kong seeks to attract institutional participation while maintaining high standards of financial integrity and international compliance.