Hong Kong is making bold moves to become Asia’s top hub for regulated digital finance, and its new stablecoin licensing regime could be a major leap forward. Authorities have announced that by the end of 2025, they will begin issuing official licenses for fiat-backed stablecoin issuers. But don’t expect a flood — according to Financial Secretary Christopher Hui, the number of licenses will likely stay in the single digits.

📌 Focused on Fiat-Backed Stablecoins & Cheaper Global Payments

The new licensing framework is expected to launch in August 2025, with a focus on stablecoins pegged to fiat currencies. The goal is to improve cross-border payment efficiency — especially in regions with volatile local currencies or outdated financial infrastructure.

Hui emphasized that fiat-backed stablecoins could reduce transaction costs and make capital flows more seamless across Asia. At the same time, he stressed the importance of robust regulation, especially for tokens tied to foreign currencies.

🥇 The Race Heats Up: Hong Kong vs. Beijing vs. the World

While Hong Kong’s licensing initially focused on HKD-linked stablecoins, there’s growing interest in yuan-based tokens. Tech giants like JD.com and Ant Group are reportedly lobbying Chinese regulators to approve such offerings — a sign of intensifying regional competition for stablecoin dominance.

Hui noted that any foreign currency-based stablecoin would require close coordination with international regulators, given the potential exchange rate and systemic risks.

🌐 Global Trend: Regulation Is Coming from All Directions

Hong Kong isn’t alone. In the U.S., the groundbreaking GENIUS Act — a federal stablecoin bill — has cleared the Senate and awaits House approval, with strong backing from President Donald Trump, who’s urging rapid passage.

Meanwhile, China’s central bank governor Pan Gongsheng acknowledged that stablecoins and CBDCs are increasingly shaping global payment ecosystems.

While mainland China maintains strict bans on crypto trading and mining, Hong Kong is positioning itself as a “crypto freedom zone.” The city’s Monetary Authority (HKMA) launched a stablecoin sandbox last year, attracting big names like Standard Chartered, Animoca Brands, HKT, JD Coinlink, and RD InnoTech.

⚖️ Hong Kong Sets a Global Standard: Full Reserves & Strict Oversight

The newly passed stablecoin legislation requires issuers to:

🔹 Hold full asset reserves

🔹 Separate client and corporate funds

🔹 Operate under direct HKMA supervision

The goal? To build trust and minimize financial risks in the growing digital asset economy.

According to YeFeng Gong, Head of Risk & Strategy at licensed crypto firm HashKey, this policy sets a global benchmark. “It brings institutional-grade safeguards that have long been missing in the stablecoin space. Hong Kong is becoming a model for the world,” he said.

🔍 One-Minute Recap:

🔹 Hong Kong will issue its first official stablecoin licenses by year-end

🔹 Focus on fiat-backed tokens and global payment improvements

🔹 City aims to lead Asia’s regulated digital finance space

🔹 New law mandates full reserves, segregation of funds, and HKMA oversight

🔹 Stablecoins are becoming central to the future of finance



#Stablecoins , #crypto , #CryptoNews , #Regulation , #CBDC

Stay one step ahead – follow our profile and stay informed about everything important in the world of cryptocurrencies!

Notice:

,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“