Hong Kong is set to follow through with its plans to launch its stablecoin licensing regime on August 1, 2025. However, the city will issue these licenses to a limited number of applicants, likely in the single digits, by the end of the year.
Speaking to a local newspaper, Ming Pao, in a Monday interview, Secretary for Financial Services and the Treasury, Christopher Hui, confirmed that the city’s new regulatory framework will be announced later this month before it takes effect in August.
The guidelines for the stablecoin license that the Hong Kong Monetary Authority (HKMA) is currently seeking market feedback for will cover anti-money laundering and other related requirements. The license will also support the use of fiat-backed digital assets in real-world applications, particularly cross-border payments.
Institutions Gear Up for Stablecoin Licenses
In the interview, Hui expressed his anticipation of receiving license applications in August after the stablecoin ordinance has been implemented, intending to grant licenses before the end of 2025.
At least nine institutions have already expressed interest in applying for the license, with some reportedly actively exploring the opportunity. The number of interested market players goes against Hong Kong’s plan to issue only a limited number of licenses.
Among these prospective applicants are three institutional groups participating in the HKMA’s stablecoin issuer sandbox, all of which are focused on issuing stablecoins pegged to the Hong Kong dollar.
Speaking on the importance of stablecoins in the city’s economy, Hui said:
“We hope that [stablecoins] will focus on addressing the difficulties and pain points in the real economy, such as cross-border payments, especially when involving local currencies with higher risks, or when the local financial system is not so well-developed, creating certain challenges for cross-border payments. However, if there are stablecoins based on fiat currencies serving as effective payment tools, they can facilitate cross-border transactions and reduce transaction costs.”
Hong Kong Advances in Crypto
Hong Kong has advanced its crypto regulatory framework. In a report from a few weeks ago, the Chinese city launched a framework that allows crypto trading platforms approved by the Securities and Futures Commission (SFC) to offer staking services.
