Hong Kong introduces 0% capital gains tax on Bitcoin, but the full picture is more nuanced

Hong Kong’s proposal to explicitly extend a zero-percent capital gains treatment to virtual-asset gains for qualifying funds and family offices reinforces its bid to attract institutional crypto capital. While the city has historically had no general capital gains tax, the consultation paper (Nov 2024) and 2025–2026 budget signal formal inclusion of digital assets into preferential fund regimes, with legislative drafts expected in 2026. If enacted, the change would likely encourage hedge funds and family offices to increase allocations to Bitcoin and Ethereum by removing capital-gains drag on returns, though active trading remains subject to profits tax. Retail holders should see little immediate change.