Hong Kong is set to enforce the Stablecoin Ordinance starting August 1, 2025, rendering unlicensed fiat-referenced stablecoins immediately illegal for retail investors. The Hong Kong Monetary Authority strictly requires issuers to obtain a license now, as penalties for non-compliance will include fines of approximately $6,300 and a six-month imprisonment.
New Rules for Stablecoin Issuers
The Hong Kong Monetary Authority (HKMA), in charge of this new regulation, mandates that issuers get a license to operate legally in Hong Kong. Unlicensed FRS can only be sold to professional investors, not the general public. The HKMA plans to issue a limited number of licenses at first, with big companies like Ant Group and JD.com applying.
Speaking to a local newspaper regarding this earlier this month, Secretary for Financial Services and the Treasury, Christopher Hui, confirmed that the country was set to follow through with its plans to launch its stablecoin licensing regime on August 1, 2025.
However, he reminded that the city will issue these licenses to a limited number of applicants, likely in the single digits, by the end of the year. The city’s new regulatory framework will be announced later this month before it takes effect in August.
Hong Kong’s Regulatory Advancement
Hong Kong has made major changes to its rules for digital assets in recent years. Since 2018, the Securities and Futures Commission (SFC) has required crypto exchanges to get licenses to trade virtual assets.
The Stablecoin Ordinance aligns with global efforts, such as the EU’s Markets in Crypto-Assets (MiCA) framework. It focuses on investor safety by ensuring only regulated companies manage stablecoins. Licensed issuers must follow strict guidelines for transparency and reserves, which lowers risks related to price swings and fraud.
Only regulated platforms and authorized institutions will be allowed to trade stablecoins. The HKMA is also working with global regulators to set consistent standards, which will help strengthen Hong Kong’s role as a crypto hub with strong oversight.
The HKMA is prioritizing quality by issuing a limited number of licenses. Companies like Ant Group and JD.com could have a big impact on the stablecoin market, helping Hong Kong become a leader in safe and innovative cryptocurrency practices.
