Hong Kong to Introduce Licensing Regime for Stablecoin Issuers, Announces Sandbox Participants

Jul 17, 2024, 08:52 PM

Hong Kong's financial regulators, including the Hong Kong Monetary Authority (HKMA) and the Financial Services and the Treasury Bureau (FSTB), have announced plans to introduce a licensing regime for stablecoin issuers. This move follows the release of consultation results, which received over 100 submissions from industry stakeholders, the vast majority of whom supported the licensing initiative. The proposed regime will require stablecoin issuers, whose tokens reference the price of fiat currencies, to obtain licenses and set up physical companies in Hong Kong. Additionally, reserve assets must be entrusted to licensed banks in Hong Kong. The HKMA has also announced the participants in its stablecoin issuer sandbox, including Standard Chartered Bank (Hong Kong) Limited, Animoca Brands Limited, Hong Kong Telecommunications (HKT), JINGDONG Coinlink Technology Hong Kong Limited, and RD InnoTech Limited. This regulatory framework, developed after consultations with 108 stakeholders, aims to bolster financial stability and align with international standards. The sandbox was initially announced in March.