Hong Kong’s Legislative Council has just passed a bill focused on stablecoins, which will build a regular licensing system for their issuers.
Wednesday’s passage of the “Stablecoins Bill” is an important part of Hong Kong’s plan to become a world leader in digital assets. Anyone planning to issue fiat-backed stablecoins in the region must now be authorized by the Hong Kong Monetary Authority (HKMA).
The law will be implemented in the latter part of the year so that companies can prepare for it. While this is happening, the HKMA will continue to consult with stakeholders to complete the framework’s operational details.
Under the new rules, the issuers of stablecoins are held to high standards in various crucial fields. Examples are organizing reserves wisely, ensuring easy redemption of client money, and keeping client assets separate from the firm’s funds.
Issuers are also expected to implement solid systems to maintain price stability and meet anti-money laundering (AML) and counter-terrorism financing (CTF) requirements, alongside broader risk management protocols.
The Monetary Authority (MA), will conduct consultations on the detailed regulatory requirements of the regime in due course. The regulatory regime will also provide better protection for the general public and investors.
Secretary for Financial Services and the Treasury, Christopher Hui, emphasized that the new law is built on the same activity, same risks, and same regulatory principles. He noted that the focus will remain on a risk-based approach to ensure the integrity and resilience of Hong Kong’s digital asset ecosystem.
Legislator Johnny Ng, a key member of the bill’s committee, celebrated the move on social media platform X (formerly Twitter), calling it a foundational step toward building Web3 infrastructure in the region.
Issuing stablecoins is only the beginning, Ng stated. The real impact lies in developing real-world applications — from physical retail and peer-to-peer payments to cross-border trade. There’s a massive, untapped potential waiting to be unlocked.
This legislation builds on Hong Kong’s ongoing efforts to attract and regulate crypto businesses.
The region introduced a crypto license for trading platforms in 2023 and then the stablecoin sandbox in March 2024. Standard Chartered, Animoca Brands, and Hong Kong Telecommunications are among the names taking part in the program.
Hong Kong has launched its regulations just in time, as major countries are developing their own stablecoin laws. On the same day as the bill’s passage, the U.S. Senate also introduced its own bill about stablecoins called the GENIUS Act. Lawmakers in America have yet to make the final changes before a total vote is cast.
This legislation allows Hong Kong to take a leading role in digital currency, not just by overseeing but by driving progress in blockchain use.
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