Hong Kong’s financial watchdogs are suggesting fresh guidelines for firms aiming to launch stablecoins, digital currencies pegged to standard currencies like the U.S. or Hong Kong dollar.
These guidelines require companies to obtain a permit and trial their digital currency in a supervised environment known as a regulatory sandbox. The objective is to provide clear standards for these businesses.Â
Hong Kong’s primary financial overseers, such as the HKMA (Hong Kong Monetary Authority) and FSTB, are inviting feedback from the public on these suggestions until February’s end.
Hong Kong aims to become a leading center for cryptocurrency activities in the region. In June, it set up rules for companies dealing with cryptocurrencies, especially those catering to individual traders.
Under the new rules, companies wanting to issue stablecoins linked to the Hong Kong dollar or promote them to the local public must get approval from the HKMA. Essentially, these rules ensure that any firm dealing with these types of digital currencies in Hong Kong is properly licensed and regulated.
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