Hong Kong crypto sector seeks eased CARF rollout

Hong Kong’s crypto sector urges eased CARF rollout, lighter penalties, and stronger privacy ahead of new crypto tax reporting rules by 2028.

The Securities & Futures Professionals Association of Hong Kong (HKSFPA) and the broader crypto industry are urging the government to ease the implementation of the OECD’s Crypto Asset Reporting Framework (CARF) and updates to the Common Reporting Standard (CRS). While supporting transparency and regulatory compliance, industry leaders highlight concerns about operational difficulties, personal liability for directors, and data privacy risks. They suggest lighter reporting requirements for entities without crypto activity, limits on penalties for honest mistakes, and administrative rather than criminal sanctions. The sector also requests streamlined registration for firms not involved in cross-border reporting, a grace period for complex filings, and early access to technical documentation. The HKSFPA further recommends allowing third parties to manage records for dissolved companies and calls for enhanced personal data protections. Hong Kong, among the first to adopt CARF, aims to start automatic crypto tax data exchanges by 2028 as part of its digital asset sector growth strategy.