Written by: Peggy, 0x2333
Starting from August 1, 2025, the Hong Kong Monetary Authority (HKMA) will open applications for stablecoin issuance licenses, marking a new phase in the development of stablecoins in the Hong Kong region, transitioning into formal implementation.
This policy has been in the works for a long time. Over the past year, the HKMA has promoted sandbox testing for stablecoin application scenarios and gradually clarified regulatory guidelines and application pathways. Now, participating institutions will move from testing to issuing and circulating under a formal regulatory framework.
According to incomplete statistics, dozens of institutions have expressed their intention to apply for stablecoin licenses. Meanwhile, more local banks, technology companies, and Web3 teams are making further preparations around clearing systems, custody mechanisms, and payment interfaces.
This article will continue to track the latest news related to stablecoins in Hong Kong for industry practitioners to reference.
Progress of Stablecoin Regulation in Hong Kong
1. Regulatory System Officially Takes Effect
The "Stablecoin Ordinance" will officially take effect on August 1, 2025.
The HKMA will simultaneously publish four related documents (available in English only):
· Consultation summary and formal guidelines for "Licensed Stablecoin Issuer Regulatory Guidelines"
· Consultation summary and formal guidelines for "Anti-Money Laundering and Counter-Terrorist Financing Guidelines (Applicable to Licensed Stablecoin Issuers)"
· Summary explanation of the "Stablecoin Issuer Licensing System"
· Summary explanation of the "Transitional Provisions for Existing Stablecoin Issuers"
2. Licensing Process and Requirements
The HKMA will accept the first round of applications for stablecoin issuer licenses from August 1 to September 30, 2025.
Institutions intending to apply are encouraged to proactively contact the HKMA via official email by August 31 to discuss regulatory expectations and feedback.
The HKMA reminds market participants: public communication must be cautious, and false claims of having obtained a license or being in the process of applying are prohibited, otherwise it is illegal.
3. Application Conditions and Compliance Requirements
All compliant stablecoin holders in Hong Kong must have their identities verified, effectively implementing a real-name system.
HKMA Assistant General Manager (Regulation and Anti-Money Laundering) Chen Jinghong stated that this requirement is stricter than the previous "white list" system; in the future, if technology matures, there may be opportunities for relaxation.
Legislative Council member Wu Jiezhuang added: the HKMA will indeed implement KYC, and real-name verification is one possible method, with specific plans proposed by issuers and confirmed after HKMA review.
4. HKMA's Stance on Fiat-Collateralized Stablecoins
HKMA Vice President Chen Weimin stated:
· Applications for stablecoin licenses pegged to a single fiat currency are allowed,
· Applications for stablecoin licenses pegged to a basket of fiat currencies are also allowed,
· However, the specific currencies must be clearly stated at the time of application.
Chen Weimin also emphasized: the licensing threshold is very high, with the first license expected to be issued in early next year.
5. Transitional Arrangements and Classification Handling
After the implementation of the "Stablecoin Ordinance," there will be a 6-month transitional period, during which the HKMA will classify existing issuing institutions:
· Those meeting regulatory requirements: may obtain a temporary license;
· Those failing to meet standards within 3 months: must cease operations within 4 months;
· Those not meeting standards: must terminate operations within 1 month after receiving notification.
Requirements include: full reserves, redemption processing within one day, establishing a physical presence in Hong Kong, maintaining financial resources, KYC, transaction monitoring, etc.
Violators will face penalties such as fines, suspension, or revocation of licenses.
Latest Statements from Hong Kong Policy Makers on Stablecoins
As the "Stablecoin Ordinance" is set to officially take effect on August 1, 2025, the Hong Kong government and relevant institutions have been intensively releasing policy signals regarding stablecoins on various occasions. These statements cover not only regulatory logic and licensing mechanisms but also key issues such as pegged currencies, implementation scenarios, and risk management, gradually outlining the actual operational framework of Hong Kong's stablecoin regulatory system.
1. Stablecoins Are Not Speculative Tools, But Financial Infrastructure
Among all public statements, a repeatedly emphasized position is: stablecoins should not become tools for market speculation.
On July 20, Hong Kong Financial Development Council Chairman Hong Peizheng pointed out at the annual report release that stablecoins should play their "stability" role, and the digitization of asset markets is a long-term battle that should not be viewed with short-sightedness. He also stated that different assets will be "tokenized" in the future, but this process will not be completed in 24 hours, nor should there be expectations for the entire financial system to be "fully on-chain" in the short term.
Secretary for Financial Services and the Treasury Xu Zhengyu has repeatedly reiterated similar views in public over the past few months. He believes that stablecoins should be seen as financial development tools to enhance financial efficiency, rather than as means of profit generation. On June 29, he stated that the government will adhere to a clear regulatory philosophy and require issuers to have capital, reserve mechanisms, and redemption capabilities to prevent systemic risks and safeguard monetary sovereignty.
Financial Secretary Chen Maobo has also pointed out in several signed articles that stablecoins possess programmable characteristics that can be used for payment automation and restructuring financial service processes, but their development should not detach from the focus on the real economy's needs. He emphasized: "It is not merely about pursuing technology, nor is it a frenzy of tools."
Voices from central think tanks have also pointed out the macro background of stablecoins. On June 21, Li Yang, Chairman of the National Financial and Development Laboratory, stated that stablecoins are essentially an on-chain extension of the US dollar and a tool for the US to promote the digitization of dollar hegemony. China should take the opportunity to promote the internationalization of the renminbi and consider developing a complementary mechanism between renminbi stablecoins and central bank digital currencies.
2. Licensing System Tightened, High Application Thresholds
Hong Kong's stablecoin regulatory system will adopt a high-standard review mechanism. On July 30, HKMA Vice President Chen Weimin clearly stated at a technical briefing that the licensing threshold is "very high," and in the first phase, a large number of licenses will not be issued at once; instead, each application will be evaluated based on the quality of the submitted materials. The first license is expected to be issued early next year.
HKMA Chief Executive Yu Weimin previously pointed out in a written article that the compliance requirements faced by stablecoin issuers are almost equivalent to those of financial institutions such as electronic wallets and banks, with consistent regulation applied in asset reserve management, redemption policies, and anti-money laundering mechanisms. Initially, only a "small number of licenses" will be issued, focusing on evaluating the issuer's business plan, actual scenarios, reserve capabilities, and technical security.
Xu Zhengyu has repeatedly pointed out that issuers must "complete redemption within one day" after a user initiates it, while also establishing stabilization mechanisms and customer asset isolation mechanisms, fully implementing anti-money laundering and counter-terrorist financing regulations.
3. Application Scenarios Prioritize Cross-Border Settlement, Followed by Web3
In contrast to narratives emphasizing "on-chain" or "DeFi-ization," the policy layer's positioning of stablecoins has always centered on cross-border payments and clearing systems.
Yu Weimin stated that the first batch of stablecoins will primarily focus on cross-border trade settlement and Web3 scenario testing. He also emphasized that participation in the sandbox is not a prerequisite for licensing; even institutions that have entered the testing scope do not necessarily mean they will obtain formal licenses in the future.
Xu Zhengyu mentioned in an interview that stablecoins could serve as alternative payment methods for local currency fluctuations in the "Belt and Road" regions, especially suitable for underdeveloped foreign exchange market scenarios such as infrastructure projects and engineering contracts.
Chen Maobo stated that Hong Kong will continue to promote the tokenization of financial assets, gradually introducing token settlement mechanisms in markets such as green bonds, ETFs, and metal commodities, and establishing a bridge between trading currencies and on-chain assets through stablecoins.
4. Open Fiat-Collateralization Mechanism, Caution on Renminbi Stablecoins
Regarding the arrangement of pegged currencies, the policy layer has clearly stated that the Hong Kong regulatory framework is designed to be open.
On July 30, Chen Weimin stated that applicants can choose to peg to a specific fiat currency or a basket of fiat currencies, as long as it is clearly declared at the time of application.
Previously, Xu Zhengyu had also discussed the possibility of "renminbi stablecoins" multiple times. He pointed out that there is no legal prohibition against pegging to the renminbi, but if it involves exchange rate management and macroeconomic policy, communication and coordination with relevant mainland institutions are necessary. "Hong Kong has legal space, but if it is to be done, it must consider the entire country's exchange rate and monetary policy."
Chen Maobo has also pointed out in his essays that allowing the use of different fiat currencies as collateral assets is beneficial for attracting more international institutions to choose to issue stablecoins in Hong Kong based on their actual application scenarios.
5. Cautious Reminders for Investors and the Public
While promoting institutional construction, several policymakers have also issued calm reminders regarding market enthusiasm.
Legislative Council member Wu Jiezhuang stated that Hong Kong has vast space for the development of stablecoins, which will become a practical experimental field for the integration of finance and the real economy in the future. However, he specifically reminded that retail investors should remain vigilant in the face of emerging asset classes and should not blindly follow trends, but rather fully understand product risks.
The HKMA has also issued a notice reminding the public to be cautious of stablecoin projects or individuals claiming to be "licensed" or "in the process of applying for a license" without authorization, emphasizing that if the public holds unlicensed stablecoins, they must bear the associated risks themselves.
How Does the Market View Hong Kong's Stablecoin Regulation?
As the "Stablecoin Ordinance" in Hong Kong is about to be implemented, the market has engaged in intensive discussions around topics such as the licensing pace, scenario pathways, and the possibility of renminbi pegging. Voices from brokerages, fund companies, foreign investment banks, and media are gradually revealing the market's structural expectations and potential impacts regarding this regulatory system.
1. Licensing Pace and Expectations for First Batch of Licensed Institutions
On July 30, CITIC Securities released a research report stating that the "Summary Explanation of the Stablecoin Issuer Licensing System" will become the most valuable official document for reference during the current application phase. The report predicts that the number of initial stablecoin licenses will be "only in single digits," with the earliest expected to be issued before the end of the year. The HKMA encourages institutions to contact regulators before August 31, with the formal application deadline set for September 30.
The report suggests focusing on two main lines: one is issuers with a clear possibility of license approval; the other is platform companies that have confirmed participation in the construction of stablecoin usage scenarios.
Guan Tian, CEO of Huaxia Fund (Hong Kong), views the current stage as a "critical point where basic rules are established and scenario pilots are about to start." He revealed that Huaxia Fund has participated in the Hong Kong stablecoin sandbox testing and is exploring an integrated path for payment, subscription and redemption, and asset management. He believes that in the future, whoever can first establish a closed loop of "compliance + implementation + asset connection" may become a leading force in the stablecoin market.
2. Regulatory Path and the "Dual-Track Parallel" Concept of HKD/RMB
On July 23, Ping An Securities released a report stating that Hong Kong may form a "dual-track regulatory framework of USD stablecoins connecting to international markets + HKD stablecoins connecting to the mainland." On one hand, it continues to attract USD-dominated projects to Hong Kong; on the other hand, it also reserves institutional space for the internationalization of the renminbi.
The report pointed out that Hong Kong's definition of stablecoins is not limited to a specific fiat currency, and the market share of non-USD stablecoins may increase in the future. Currently, Hong Kong's stablecoin regulation has included overseas projects that are "partially pegged to HKD" within its regulatory scope.
Xiao Feng (Chairman of HashKey Group) stated in an interview that the Hong Kong stablecoin license will not be limited to HKD pegging; the pegged currencies and deployment of public chain networks will be determined by the issuers themselves. He mentioned that networks like Ethereum and Solana can serve as the infrastructure for deploying Hong Kong stablecoins.
3. Policy Expectations and Financial Function Concepts for CNH Stablecoin
Since June, the question of whether the "offshore renminbi stablecoin (CNH Stablecoin)" will be piloted in Hong Kong has become a hot topic in the market.
Morgan Stanley pointed out that the Hong Kong stablecoin ordinance has "laid the first legal path" for CNH stablecoins. Supported by an offshore liquidity pool of approximately 1 trillion RMB, CNH stablecoins can validate the feasibility of cross-border settlements without violating mainland capital controls and serve as a supplementary payment channel outside of CIPS and SWIFT.
Morgan Stanley's Chief Economist for China, Xing Ziqiang, stated that Hong Kong should first promote stablecoins pegged to the US dollar and HKD to establish a foundation of technological and market trust, and then gradually introduce CNH stablecoins to strengthen the renminbi's position in the digital payment system.
The "Hong Kong Economic Journal" stated that Hong Kong could act as a "testing pioneer" to promote the implementation of CNH stablecoins to respond to the competition for international payment discourse. However, this requires proper handling of regulatory requirements such as anti-money laundering and counter-terrorist financing.
The "Economic Observer" commented that if CNH stablecoins are piloted in Hong Kong, it would create a renminbi channel independent of the SWIFT system and open new digital pathways for the internationalization of the renminbi. This exploration could represent another institutional leap following the establishment of the renminbi cross-border settlement mechanism in 2009.
Wang Yongli, former Vice President of Bank of China, also expressed that the US is strategically developing dollar stablecoins through legislation, and China should respond proactively. The Hong Kong stablecoin regulatory system is at the forefront and has the practical conditions to pilot CNH stablecoins, which could be prioritized for overseas cryptocurrency trading and clearing.
4. Impact on Financial Markets and Capital Focus
Guangfa Securities noted in a report on June 3 that while the Hong Kong stablecoin draft is still in its early stages, it will bring structural investment opportunities in the short term, mainly concentrated in sectors such as digital currencies, cross-border payments, blockchain, and RWA. The report believes that if policies clearly support renminbi-pegged stablecoins, some related companies in the A-share market will benefit from the compliance value released by the "Hong Kong Bridge" channel.
However, Guangfa Securities also pointed out that due to the current strict regulation of virtual assets in China, the probability of large-scale incremental capital entering the market remains low.
Ping An Securities further added that as global stablecoin regulations gradually take shape, it is expected to promote the establishment of a unified international regulatory framework. China needs to seize the institutional window period to explore controllable paths through Hong Kong, avoiding being completely monopolized by dollar stablecoins in the digital asset field.
CCTV's "Yuyuan Tan Tian" and "Securities Times" have also published comments, stating that the US is promoting the digitization of the dollar through stablecoins, representing a new form of financial expansion. If China remains long-term absent in the stablecoin layout, it may passively respond to the new settlement network dominated by the dollar.
Who is Preparing to Apply for Hong Kong Stablecoin Licenses?
As the "Stablecoin Ordinance" is set to take effect on August 1, 2025, several companies are accelerating their entry pace, preparing or announcing their applications for stablecoin issuer licenses. These participants come from various industry backgrounds, including financial institutions, technology platforms, payment companies, and blockchain startups, reflecting the diverse responses triggered by the implementation of Hong Kong's stablecoin regulatory system.
1. Overall Market Entry Enthusiasm
According to reports on July 14, 50 to 60 companies have expressed their intention to apply for Hong Kong stablecoin licenses.
· About half of these are payment institutions, while the other half are well-known internet companies;
· Most have Chinese backgrounds;
· It is expected that only 3–4 licenses will be issued in the initial phase, with stablecoins primarily pegged to HKD and USD.
2. Sandbox Pilot Institutions List (Published on July 18, 2024)
The following 5 institutions are participating in the stablecoin issuer sandbox testing:
JD Coin Chain Technology (Hong Kong) Limited
Yuan Coin Innovation Technology Limited
Standard Chartered Bank (Hong Kong) Limited
Anni Group Limited
Hong Kong Telecommunications (HKT) Limited
3. Companies Clearly Indicating They Will Apply or Are Applying for Licenses
· China SanSan Media
On July 15, it announced plans to apply for a Hong Kong stablecoin license, with funding sourced from share placements and cash reserves.
· Tian Sheng Capital
On July 11, it announced plans to establish a digital asset trading and settlement company and apply for a stablecoin license. It plans to use stablecoins for art trading and settlement services, focusing on cross-border trade settlements.
· Duodian Smart
On July 3, it announced that it is preparing to apply for a Hong Kong stablecoin license.
· Animoca Brands + Standard Chartered Bank (Hong Kong) + Hong Kong Telecommunications
They have publicly stated multiple times that they will jointly establish a joint venture to apply for a license and issue HKD stablecoins. The stablecoins will be used in scenarios such as virtual asset trading in games, cross-border trade, and financial settlements.
· JD
It has publicly stated on its official website that it will issue a stablecoin pegged 1:1 to HKD in Hong Kong. The issuing entity is JD Coin Chain Technology (Hong Kong), which is also included in the HKMA's list of stablecoin "sandbox" participants.
· Ant International
According to insiders, the company will immediately apply for an issuer license after the Hong Kong "Stablecoin Ordinance" takes effect, and it also plans to seek licenses in Singapore and Luxembourg.
· Lianlian Digital
According to insiders, Lianlian Digital is actively exploring the application for stablecoin licenses in Hong Kong and Singapore. Its subsidiary DFX Labs has already obtained a virtual asset trading platform license issued by the Hong Kong Securities and Futures Commission.
4. Companies Researching, Monitoring, or Layouting Related Businesses
· Ping An Insurance
On July 21, it responded on an interactive platform that it has been paying attention to changes in Hong Kong's stablecoin regulations and is actively researching.
· Sanwei Xinan
On June 30, it stated that the company has participated in related businesses such as virtual currencies and stablecoins in Hong Kong and, as a cryptographic infrastructure provider, will provide security guarantees for related projects.
5. Clarifications
· Octopus Holdings
It was rumored to be involved in a stablecoin accelerator project. The company later clarified that it only participated in an exploratory program led by Brinc in an "advisory capacity," which is conceptual research and not related to stablecoin product development or formal cooperation.
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