Home Hong Kong unveils AI finance and possible crypto tax break policy

Hong Kong unveils AI finance and possible crypto tax break policy

Hong Kong authorities have introduced their first policy guidelines focused on the use of AI in finance and proposed a tax incentive for virtual assets, aiming to strengthen its position as a business hub in Asia.

In his keynote speech at Hong Kong’s Fintech Week, Secretary for Financial Services and the Treasury, Christopher Hui, announced that the government is considering extending a tax break on digital asset ownership, including cryptocurrencies, with plans for legislation by the end of the year.

He also touted the development of a unified framework, enabling various regulatory bodies to establish policies governing AI—a technology seen as key for the future of finance and other industries.

Hui said: “Hopefully, by expanding the availability of tax concessions to this wider scope of assets eligible under our fund regime and our family office regime, we will be able to add that extra impetus and pull to this [Hong Kong] market on their development front.”

Hong Kong set to license more crypto exchanges

At the same event, Hong Kong’s Securities and Futures Commission (SFC) announced plans to license additional cryptocurrency exchanges by the end of 2024. Eric Yip, SFC’s Executive Director for Intermediaries, stated that the commission has been actively collaborating with applicants, providing feedback that has encouraged many exchanges to allocate sufficient resources for full regulatory compliance.

In 2023, Hong Kong launched its digital-asset licensing framework, allowing retail crypto trading on approved platforms. To date, only three platforms—HKVAX, HashKey, and OSL—have received full licenses, while another 11 operate under provisional permits as they work to meet the SFC’s compliance standards.

Yip noted that by early 2025, the SFC plans to establish a consultative panel with licensed exchanges to strengthen cooperation. The city is also drafting a comprehensive regulatory framework for crypto-focused over-the-counter trading desks and custodians.

Separately, on Monday (Oct, 28), Hong Kong Exchanges and Clearing Ltd. announced its upcoming Virtual Asset Index Series, aimed at providing enhanced benchmarks for Bitcoin and Ether pricing within Asia-Pacific time zones.

In May, ReadWrite reported that Hong Kong approved the launch of six spot Bitcoin (BTC) and Ethereum (ETH) exchange-traded funds (ETFs). The country’s financial regulators say they are prepared to adjust their approach to cryptocurrency regulation as the industry develops.

Featured image: Canva

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The ReadWrite Editorial policy involves closely monitoring the tech, gambling and blockchain industries for major developments, new product and brand launches, AI breakthroughs, game releases and other newsworthy events. Editors assign relevant stories to in-house staff writers with expertise in each particular topic area. Before publication, articles go through a rigorous round of editing for accuracy, clarity, and to ensure adherence to ReadWrite's style guidelines.

Suswati Basu
Tech journalist

Suswati Basu is a multilingual, award-winning editor and the founder of the intersectional literature channel, How To Be Books. She was shortlisted for the Guardian Mary Stott Prize and longlisted for the Guardian International Development Journalism Award. With 18 years of experience in the media industry, Suswati has held significant roles such as head of audience and deputy editor for NationalWorld news, digital editor for Channel 4 News and ITV News. She has also contributed to the Guardian and received training at the BBC As an audience, trends, and SEO specialist, she has participated in panel events alongside Google. Her…

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