The hottest topic recently in the cryptocurrency circle must be this move by Hong Kong—starting August 1, the (stablecoin regulations) officially take effect, and stablecoin issuers must obtain a license to operate! Is this regulatory implementation a 'tightening spell' or a 'calming pill'? Let's break it down for you today.

First, understand: what does this regulation cover?

In simple terms, if you want to issue 'fiat stablecoins' (such as those pegged to the Hong Kong dollar or US dollar) in Hong Kong, you must first apply for a license from the Monetary Authority. You can't just register a company and start operating—licensed entities must meet a set of stringent requirements:

✅ Must have 'real reserves': For example, if pegged to 100 units, there must be corresponding cash or short-term government bonds as 'hard assets' to back it up; you can't play the trick of empty-handed gains.

✅ Redemption must be convenient: Users want to exchange stablecoins back to fiat, it must be processed promptly, and cannot be delayed.

✅ Assets must be segregated: Users' reserve assets must be kept separately and cannot be mixed with the company's own money; even if the company encounters problems, users' funds can still be protected.

It also needs to pass anti-money laundering, risk control, regular audits, and other requirements... The threshold is set very high!

Why is it so strict?

The Monetary Authority has stated: 'Initially, only a few licenses may be issued', and they must be for players 'with actual application scenarios and capable of stable operations'. In simple terms, this means—filtering out small operations, leaving only reliable 'regular troops'.

Previously, the stablecoin space was turbulent, with some projects having opaque reserves and others suddenly 'de-pegging' (for example, the price falling outside the pegged range), making it easy for retail investors to fall into traps. Now that regulations are in place, it effectively provides a label of 'official certification' for compliant stablecoins. In the future, when investing, at least we know 'those with licenses are more reliable', and confidence is sure to increase.

What impact does this have on us?

✔️ Ordinary investors: In the future, when looking at stablecoins, first check 'whether there is a Hong Kong license'—you can't go wrong! With stricter regulations, the chances of random coin issuance and exit scams will be significantly reduced, and the risk of stepping on landmines will decrease.

✔️ Crypto enthusiasts: Compliant stablecoins may be more 'useful'—for example, gradually integrating into traditional financial scenarios (such as transfers and payments), no longer just something for a small circle.

✔️ For project parties wanting to enter the market: Don’t think about taking shortcuts! You must honestly build a compliant framework and have adequate reserves; small teams may be directly discouraged, and the industry will become more concentrated.

Finally, a few thoughts:

This move by Hong Kong is actually crucial—global attention is on stablecoin regulation, and Hong Kong has taken the lead in establishing clear rules, which not only mitigates risks but also leaves room for innovation. In the future, if cryptocurrencies want to 'bridge' with traditional finance, compliance will undoubtedly be an unavoidable hurdle.

In short, whether you want to invest or just watch the excitement, remember: no matter how hot the crypto circle is, you must keep an eye on the two words 'compliance'—do you think stablecoins will become more popular after this wave of regulations?

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