After chatting with some banks, I kind of understand why Hong Kong's HKMA (also a banking regulator) requires every stablecoin user to go through KYC. It’s because the entire risk control system of Hong Kong banks is built around KYC. For example, if a billionaire’s account receives a few hundred million, that’s normal; but if a taxi driver’s account suddenly gets a million, they’ll need to investigate. So, as regulators, they can’t comprehend the on-chain, permissionless, no-KYC state. Meanwhile, crypto folks are used to permissionless systems and can’t understand strict KYC requirements. As always, once the industry grows bigger, there will be more friction with financial regulators and more integration with traditional finance. This kind of pain and discomfort will only increase.