Hong Kong Accelerates the Advancement of Stablecoin Regulatory Framework

The Hong Kong Monetary Authority recently released a series of regulatory documents for stablecoins, providing specific implementation guidelines for the "Stablecoin Regulation" that will take effect on August 1, 2025. These documents cover aspects such as application, operation, asset management, and anti-money laundering compliance, establishing a comprehensive regulatory framework.

The Monetary Authority stated that the first batch of stablecoin licenses is expected to be issued in early 2026, focusing on cross-border trade and Web3 applications. The first phase will only issue a small number of licenses, with high application thresholds. For existing fiat stablecoin issuers, the Monetary Authority has set a 6-month transition period, ending on January 31, 2026. Issuers who fail to complete their applications within the stipulated time or are rejected must exit their business in an orderly manner by November 2025.

In terms of risk management, the Monetary Authority requires licensed stablecoin issuers to issue fiat stablecoins only through approved service providers. Reserve assets must be strictly separated from the issuer's own assets and management policies and audit results must be disclosed regularly. Issuing institutions are also required to adopt technical measures such as multi-signature and pre-mining mechanisms, and establish a sound internal control system.

The Monetary Authority also issued anti-money laundering guidelines, requiring licensed issuers to conduct due diligence on customers and continuously monitor transactions. For non-customer holders, further verification of identity may be required under specific circumstances.

In terms of reserve assets, all issued stablecoins must be fully backed by assets. Eligible reserve assets include cash, bank deposits, and high-quality, highly liquid low-risk assets. Licensed entities may issue stablecoins pegged to different fiat currencies, but must obtain approval from the monetary authority.

Applicants must meet multiple conditions, including maintaining a paid-up capital of no less than 25 million HKD, establishing a substantive operational base in Hong Kong, and submitting detailed business plans and risk management policies.

Currently, several institutions have expressed their intention to apply for stablecoin licenses, including some well-known technology companies and financial institutions. However, the industry expects that in the first phase, Hong Kong may only issue a limited number of licenses, no more than 10 in total.

This series of regulatory measures aims to provide a clear development path and compliance standards for the Hong Kong stablecoin market, while also demonstrating Hong Kong's efforts to seek a balance between promoting financial innovation and strengthening risk prevention.