The Hong Kong government only grants limited stablecoin licenses in the initial phase and is promoting the development of digital assets along with the tokenization of financial assets.
Hong Kong has not restricted the issuance of stablecoins tied to specific currencies but may need discussions if related to other regional currencies. The government focuses on promoting the tokenization of various financial assets and expanding applications such as green bonds and ETFs.
MAIN CONTENT
Hong Kong grants a very limited number of stablecoin licenses in the initial phase.
The law does not restrict stablecoins by currency, but discussions with relevant authorities are needed if it involves other regional currencies.
The government promotes the tokenization of financial assets and expands the application of tokens in green bonds and ETFs.
How will Hong Kong issue stablecoin licenses in the initial phase?
Mr. Paul Chan, Secretary for Financial Services and the Treasury of Hong Kong, affirmed that the number of stablecoin licenses in the initial phase will be very limited to tightly manage the cryptocurrency market. This is a cautious step to protect investor interests and maintain regional financial stability.
According to Mr. Chan, the licensing of stablecoins will be tested with a small number to assess management effectiveness before expanding.
Does Hong Kong law allow the issuance of stablecoins tied to the Renminbi (RMB) or other regional currencies?
Hong Kong law does not restrict stablecoins to be tied to any specific currency, including the Renminbi, reflecting flexibility in policy.
However, Mr. Paul Chan noted that if it involves other currencies from different territories, discussions and considerations with relevant authorities are necessary to ensure legal compliance and monetary policy alignment.
The Hong Kong government does not prohibit the issuance of stablecoins linked to any currency, but will discuss thoroughly with relevant organizations when there are cross-territorial factors.
Paul Chan, Secretary for Financial Services and the Treasury of Hong Kong, 13/07/2024
What does the digital asset development policy and financial tokenization in Hong Kong include?
Hong Kong has issued a digital asset development policy 2.0 to facilitate innovation and the development of digital finance.
Secretary Paul Chan emphasized Hong Kong's experience in issuing tokenized green bonds and believes the next step is to expand tokenization to other financial products such as ETFs, thereby improving transparency and liquidity in the market.
He also hopes that payments for commodity assets such as metals will be researched for the application of token technology to enhance transaction efficiency.
Hong Kong has successfully issued tokenized green bonds, and we will expand into ETFs and explore token applications for commodity transactions.
Paul Chan, Secretary for Financial Services and the Treasury of Hong Kong, 2024
What are the benefits and impacts of tokenizing financial assets in Hong Kong?
According to financial experts, tokenization helps increase liquidity, shorten transaction times, and reduce management costs for traditional financial products.
The application of tokens to green bonds and ETFs will help attract additional investment capital, improve transparency, and enhance risk control in Hong Kong's financial ecosystem, reinforcing its position as an international financial center.
Comparison table of the advantages of traditional assets and tokenized assets.
Criteria Traditional Assets Tokenized Assets Liquidity Hard to access, market-dependent High, 24/7 trading on digital platforms Transaction costs Intermediary fees, complex procedures Low fees, automated via smart contracts Transparency Limited information, slow updates Public on blockchain, easy to verify Investor access Limited due to territorial regulations Global expansion, not regionally dependent
Frequently Asked Questions
1. Does Hong Kong limit the number of stablecoin licenses? The number of licenses in the initial phase is very limited to ensure effective control of the cryptocurrency market. 2. Can stablecoins be issued tied to the Renminbi in Hong Kong? The law does not prohibit the issuance of stablecoins linked to RMB, but if related to other regional currencies, discussions with relevant authorities will be necessary. 3. How does tokenizing financial assets benefit the market? Tokenization increases liquidity, reduces costs, enhances transparency, and attracts investment, promoting the development of digital finance. 4. What financial assets has Hong Kong successfully tokenized? Hong Kong has successfully issued tokenized green bonds and is preparing to expand into ETFs and commodities. 5. Is payment with tokens for commodity products feasible in Hong Kong? The government is researching the application of tokens in commodity transactions such as metals to enhance payment efficiency.
Source: https://tintucbitcoin.com/stablecoin-gioi-han-tai-san-token-hoa-etf/
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