New path for RMB internationalization

Hong Kong will become the world's first financial center to allow the issuance of regulated offshore RMB stablecoins, breaking the 95% market share monopoly of US dollar stablecoins.

Provide compliant payment channels outside the US dollar system for cross-border trade, reducing exchange rate fluctuations and sanctions risks.

Hong Kong's financial competitiveness upgrades

Relying on the strict framework of the Stablecoin Ordinance, attract institutions such as HSBC and Standard Chartered to issue Hong Kong dollar/RMB stablecoins. Promote the use of stablecoin settlement by enterprises in the Greater Bay Area, and the annual cross-border transaction volume may exceed 10 trillion Hong Kong dollars.

Reconstruction of the stablecoin market structure

Reshuffle of issuing entities: traditional banks and licensed institutions will dominate the market, squeezing out the share of offshore issuers such as Tether.

Catalytic effect of the crypto market

Short-term: Good for compliant exchange platform coins and stablecoin technology service providers.

Long-term: Attract institutional funds to flow into BTC/ETH through stablecoins to reduce market volatility.

Key challenges

Policy coordination: It is necessary to balance mainland capital controls and the free convertibility of stablecoins, and retail scenarios may be restricted in the early stage.

International Game: Dealing with the regulatory barriers of the US GENIUS Act restricting non-US dollar stablecoins and the EU MiCA requiring local entities.

Technical risks: Privacy technologies such as zero-knowledge proof ZKP may impact penetrating supervision.

Conclusion

Hong Kong's move is a breakthrough in incorporating encryption tools into the national financial strategy:

Short-term: Give birth to offshore RMB stablecoin pilot projects and enable cross-border trade in the Greater Bay Area.

Long-term: Build a dual-track system of digital RMB + offshore stablecoins and reshape the Asia-Pacific payment network.

Core value: Open up a new channel on the chain for the internationalization of RMB, but it is necessary to solve the problems of regulatory arbitrage and technical compliance. $BTC #GENIUS稳定币法案