As of August 1, 2025, Hong Kong has officially launched its long-awaited licensing framework for fiat-backed stablecoins. The move aims to tighten digital asset oversight while positioning the city as a global cryptocurrency powerhouse.

🔐 What Does the New Regime Entail?

Under the new law, any company intending to issue or market stablecoins to retail investors must first obtain a license from the Hong Kong Monetary Authority (HKMA).

The requirements are extensive, covering areas such as:

🔹 Reserve asset management

🔹 Redemption at par value

🔹 Segregation of client funds

🔹 Anti-money laundering measures

🔹 Transparent disclosures

🔹 Fit-and-proper checks for operators

🌏 Competing With the U.S. — Hong Kong’s Simplified Advantage

Hong Kong's regime comes shortly after the U.S. passed the GENIUS Act, the first federal stablecoin regulation in the States. Experts say the difference between the two frameworks is stark — while U.S. oversight is split between federal and state layers, HKMA acts as a single regulatory authority, allowing for faster and more transparent compliance.

In addition, Hong Kong’s rules apply to multiple fiat currencies, making it a more attractive option for globally oriented stablecoin projects.

💵 Growing Interest in Stablecoin Adoption

Despite its relatively small domestic market, stablecoin interest in Hong Kong is rapidly increasing. According to lawyer Andy K.T. Lau, clients are starting to view stablecoins not just as speculative tools, but as practical payment rails for online and offline transactions.

“I’ve seen rising client interest in partnering with stablecoin issuers and payment platforms,” said Lau. “They want to integrate stablecoins into real-world business operations.”

🚫 Local Payments Crowded, Global Use Holds Promise

Hong Kong’s payment ecosystem is already crowded—with Visa, Mastercard, QR platforms like Alipay and WeChat Pay, Octopus cards, and cash all in daily use. As a result, stablecoins are unlikely to become the dominant domestic payment method unless integrated into existing systems.

But businesses believe the true opportunity lies in international transactions. Given Hong Kong’s global trading role, stablecoins could prove useful for cross-border remittances and international B2B payments, especially for companies frustrated with sluggish bank processes.

For example, Edwin Cheung, CEO of Gate Dubai, noted strong interest from mainland Chinese businesses who want to leverage Hong Kong’s legal clarity for internal blockchain-based payment systems.

🏨 Use Cases: Travel, E-Commerce, and More

Some travel agencies are exploring stablecoins to speed up international payments, which can currently take up to 30 days. In many cases, the companies lack local bank accounts in places like Brazil or Argentina—stablecoins could bridge that gap.

Cheung believes mass adoption will likely stem from large corporations that already have robust ecosystems and can integrate stablecoins into them, encouraging users to follow suit—just like Alipay did years ago.

⚖️ Hurdles: Accessibility and High Barriers

However, not everyone is on board. Some firms, such as payment company Airwallex, have publicly rejected stablecoins, saying the tech doesn’t solve core issues in international finance.

Others criticize the regime’s capital requirements—issuers must have at least HK$25 million in paid-up capital, making entry difficult for smaller innovators.

Tiena Sekharan from Chavanette Advisors suggests tiered capital rules, allowing small-scale issuance with lower thresholds. She also recommends a passporting mechanism to let licensed firms from jurisdictions like the U.S., EU, or Singapore operate in Hong Kong without redundant licensing.


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