Hong Kong Drafts CRP-1 Rules to Classify Crypto Assets and Define Bank Capital Standards

HKMA draft groups crypto into tokenized assets, stablecoins, and non-reserve backed categories.

Framework sets capital rules for banks engaging with digital assets.

Proposal aligns with Basel standards and may take effect in early 2026.

The Hong Kong Monetary Authority (HKMA) has released a draft policy that could reshape the banking industry’s approach to digital assets. The proposed framework, issued on Monday as module CRP-1 in the “Banking Supervisory Policy Manual,” introduces new standards for classifying crypto assets and determining bank capital requirements. The public consultation invites feedback from local banks before the measures are finalized.

Grouped Asset Categories Under the Proposal

The HKMA draft divides crypto assets into two main groups, each further split into two subcategories. Group 1a consists of tokenized traditional assets, while Group 1b covers stablecoins that demonstrate reliable stabilization mechanisms. These categories may benefit from lower capital requirements if issuers can demonstrate effective risk management measures.

Group 2 encompasses digital assets without reserve backing, such as Bitcoin and Ethereum. It also includes tokenized traditional assets and stablecoins that fail to meet the Group 1 criteria. Within Group 2, assets are split into Group 2a and Group 2b, based on hedging recognition standards. These distinctions determine how much capital banks must hold against potential risks.

Broader Implications for the Banking Sector

The proposal offers banks a clearer path to engage with digital assets by setting capital standards. With structured categories, institutions can evaluate exposure to cryptocurrencies while maintaining compliance with supervisory expectations. Lower barriers could make it easier for banks to integrate digital assets into their balance sheets, provided the assets meet established safeguards.

This step follows Hong Kong’s broader regulatory agenda to manage innovation while enforcing risk controls. In August, the HKMA introduced a proposed “Stablecoin Ordinance” aimed at creating a licensing framework for stablecoin issuers. That draft incorporated anti-money laundering provisions and measures designed to strengthen security within the financial system.

Hong Kong’s Position in Regional Regulation

The proposed rules position Hong Kong as an early adopter of structured crypto regulations in Asia. By setting categories for banks to follow, the city builds a regulatory framework that accommodates both innovation and financial stability

Industry participants are expected to review the consultation paper in the coming weeks, with feedback guiding potential revisions before final implementation. Should it be enacted, the framework would represent another step in the efforts of Hong Kong to standardize crypto regulation whilst staying up to date with international regulatory trends.The consultation paper shows Hong Kong's attempt to comply with international standards set by the Basel Committee on Banking Supervision. If approved, the new framework can be implemented in early 2026. Through its adherence to Basel standards, Hong Kong aims to give banks definitive rules and harmonize practices worldwide.