Conflux Network is collaborating with fintech firm AnchorX to launch a Hong Kong dollar-pegged stablecoin, AxHKD, as early as the second quarter of 2024. This move comes in the wake of the Hong Kong Monetary Authority (HKMA) launching a regulatory sandbox for stablecoin issuers last week.
Fan Long, the CEO of Conflux, expressed confidence in the expected launch timeline, mentioning, “We hope they could push it as soon as possible. If it’s going fast, maybe in Q2, people will be able to get them from exchanges, which is the fastest possibility.” However, he admitted that the timeline relies on the speed of the regulatory sandbox progress.
The HKMA’s sandbox guides firms wanting to issue stablecoins in Hong Kong. This follows a consultation on regulating stablecoin issuers by the HKMA on February 29. The Financial Services and Treasury Bureau proposed that stablecoin issuers tied to fiat currencies need HKMA licenses.
The US dollar-pegged stablecoins raise doubts among financiers questioning if authorities could detach local currency pegs. The chief executive officer of Hong Kong-based Hex Trust, Mr. Alessio Quaglini, spoke of his doubt regarding the neediness of HK dollar stablecoin, stating, “For Hong Kong dollar [pegged stablecoins], honestly I don’t even think there’s any need for a stablecoin in Hong Kong dollars.”
The Conflux-AnchorX partnership aims to address this potential market demand by introducing a Hong Kong dollar-backed stablecoin, AxHKD, designed to maintain a 1:1 peg to the Hong Kong dollar with the whole scheme backed by high-liquidity assets commodity reserves.
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