Editor: Wu Says Blockchain
In this dialogue, Hong Kong accountant Xiao Yaohe shared the latest investment immigration case progress and related policy dynamics of his clients with Wu Says. On February 7, 2025, a client used Ethereum worth 30 million HKD as proof of assets, and their investment immigration application to the Hong Kong Investment Promotion Agency has been approved. In October 2024, another client who used Bitcoin as proof of assets was also approved, marking the first case in Hong Kong where cryptocurrency was used as an asset for investment immigration approval. Most of the relevant clients are from mainland China.
Mr. Xiao is the Deputy Managing Partner of Hongyuan CPA Limited, with over 25 years of experience in the accounting and auditing industry. He has held important positions such as Chief Accountant and Executive Manager in listed companies on the Hong Kong Stock Exchange and multinational corporations.
The audio transcription was completed by GPT and may contain errors. Please listen to the full podcast:
Xiaoyuzhou:
https://www.xiaoyuzhoufm.com/episodes/67a740e8d74435e4a3e2cfbb
YouTube:
Please introduce these two cases where cryptocurrency was used as proof of assets for investment immigration.
Xiao Yaohe: Currently, there are two successful cases of clients using cryptocurrency to prove assets. The first case was in October 2024, using Bitcoin. This is the second successful case, using Ethereum. We are also working on two other cases.
In the investment immigration program, the government or we accountants need to submit a report proving that a person has assets worth 30 million HKD. Cryptocurrencies like Bitcoin or other cryptocurrencies can also be recognized as assets.
So this investment immigration program does not require you to invest in Hong Kong, as long as you hold assets worth 30 million HKD, right?
Xiao Yaohe: That is just the first step. First, the applicant needs to prove they have assets worth 30 million HKD, regardless of where these assets are—whether in Hong Kong, domestically, or in Africa or Australia, it doesn't matter. Once the asset verification is successful, you pass the first hurdle, and then you need to bring the funds to Hong Kong for investment, and you must invest in designated assets. In simple terms, this means investing in stocks, bonds, etc., of listed companies. You must invest the funds in Hong Kong.
Currently, for these two clients, one used Bitcoin and the other used Ethereum, and they have passed the first step of asset verification, proving they have assets worth 30 million HKD. The next step is that they need to bring the 30 million HKD to Hong Kong for investment within six months.
Is this investment limited to stocks, and cannot include assets like Bitcoin or Ethereum ETFs?
Xiao Yaohe: The original intention of this investment immigration program is mainly for investors to invest in Hong Kong's stock market, capital market, and bond market, which is the most important. If you want to invest through other means, like the ETFs you mentioned, there is a slight possibility.
Because there is a way, first, you need to invest 30 million HKD into a Limited Partnership Fund company that you set up yourself. This company is 100% owned by you, and you can supervise it, but there are no specific requirements on how the company invests internally.
Whether this 30 million HKD can be used to invest in locally issued Bitcoin ETFs in Hong Kong is still uncertain. If HSBC sells you this product, they must register with the Investment Promotion Agency and provide a certificate that can prove it. If they can issue a certificate, then it means it is an investable product.
So the process for investment immigration is to first prove you have assets worth 30 million HKD (which can include Bitcoin and Ethereum), and then the Hong Kong government will issue them a two-year visa?
Xiao Yaohe: No, they also need to complete the investment within six months. Only after completing the investment will the visa be issued, which is valid for two years, and it needs to be renewed after two years. When renewing, they need to prove that the investment is still ongoing. Each year, you need an accountant to provide a report proving that the total investment amount is not less than 30 million HKD and ensure that you have not transferred other investments after the investment. However, it does not matter if the investment incurs losses.
Cryptocurrency assets can be stored in cold wallets or on major exchanges like Binance to prove them; both methods are feasible.
Reviewing the Hong Kong government's first approval of cryptocurrency assets.
Xiao Yaohe: Clients using cryptocurrency as assets for investment immigration are basically all from mainland China. There should not be many other cryptocurrency-related investment immigration cases because in October 2024, I called the Investment Promotion Agency to ask if they had similar cases, and they said no. So I was the first at that time.
The first case was in October 2024. They said they had never handled similar cases before and told me, "It's okay, you go ahead, and we will discuss internally." About a month later, the first case was successfully approved. I did not participate in their communication; it was mainly their internal discussion.
Besides Bitcoin and Ethereum, will the Hong Kong government recognize other cryptocurrencies like USDT?
Xiao Yaohe: Actually, there is no official response. There is no clear statement from the authorities indicating which currencies are recognized and which are not; it is all trial and error. You can try other currencies, but currently, we have provided two successful cases. However, from my perspective, the key is the liquidity of these cryptocurrencies and whether they have a very reliable market value.
However, some comments point out that in Singapore, cryptocurrencies have always been able to serve as proof of assets, but the difficulty lies in clients being unable to provide proof of the initial investment funds for the cryptocurrencies.
An article from AiYing Compliance states that the biggest challenge is indeed proving the source of funds (SOF). There is a classic contradiction in the cryptocurrency circle—"You can take out the coins, but you can't clarify the money." Early players often have a "dark history": many obtained coins through mining, over-the-counter trading, or even "gifts from friends," and cannot provide bank statements or transaction records. Issues with exchanges like FTX and Binance have hindered progress: some users have lost historical data or it is not recognized by regulators. Anonymity is a double-edged sword: while blockchain is transparent, wallet addresses and real identities are hard to link directly, making it difficult for accountants and immigration authorities to trace the source of funds. For example, a major player bought Bitcoin for 1 million HKD in 2017, which is now worth 10 million HKD. However, the transfer records from that year are long gone, or the transaction was done in cash, making it hard to prove that this 10 million is legal income. If this cannot be clarified, the immigration application will be directly rejected. Therefore, it is recommended to keep evidence from day one: transfer records of buying coins, exchange statements, tax proof, or even a handwritten receipt, all of which are better than having nothing.
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