Hong Kong Discusses New Stablecoin Bill
The Hong Kong Legislative Council held its first session to review a proposed stablecoin bill. Introduced in December, the legislation aims to establish clear regulatory guidelines and bolster Hong Kong’s position as a cryptocurrency hub.
On January 21, 2025, the council’s committee met with government officials to discuss the details of the proposed legislation. According to local news outlet Da Kung Pao, Francis Ho, Deputy Secretary for Financial Services and the Treasury, highlighted that stablecoin issuers will be required to obtain licenses from the Hong Kong Monetary Authority (HKMA).
The bill, originally presented on December 18, mandates that stablecoin issuers implement strong reserve stabilization mechanisms. These reserves must be composed of high-quality, liquid financial assets.
Hong Kong continues to create a supportive environment for cryptocurrency companies. In 2023, the region implemented a licensing framework for cryptocurrency trading platforms. In March, the Hong Kong Monetary Authority (HKMA) launched a sandbox for stablecoin issuers, attracting participants such as Standard Chartered Bank, Animoca Brands, Hong Kong Telecommunications, Jingdong Coinlink, and RD InnoTech.
On January 21, the Legislative Council’s cryptocurrency subcommittee held another session to review the current licensing system for crypto trading platforms.
Joseph Chan, Deputy Secretary of the Financial Services and the Treasury Bureau (FSTB), announced that the Securities and Futures Commission (SFC) plans to establish an advisory group for cryptocurrency trading platforms. The group aims to address industry needs and incorporate feedback when shaping regulatory policies.
Chan also noted that the government intends to regulate over-the-counter (OTC) cryptocurrency trading. The first phase of public consultations on this topic was conducted last year, with a second phase scheduled for this year.
Additionally, Hong Kong is working on licensing regulations for crypto custodians. These proposed rules are expected to be released for public consultation later this year.
Hong Kong’s Vision for Integrating Cryptocurrencies into Its Financial System
The Hong Kong government is actively pursuing the integration of cryptocurrencies into its financial infrastructure to become a global hub for crypto and blockchain companies. This initiative is designed to drive the growth of advanced financial services and strengthen the region’s competitiveness on the international stage.
Cryptocurrencies are seen as a crucial tool for attracting international investors and fostering a thriving ecosystem of startups. The government aims to create a well-balanced regulatory framework that encourages innovation while safeguarding users and mitigating financial risks.
In its effort to position itself as a key player in digital assets and blockchain technology, Hong Kong is offering flexible conditions for cryptocurrency platforms and tech companies. The region is also aligning its regulatory framework with global standards, including those set by the European Union and the United States, to stay ahead of the tightening global crypto regulations.
By taking these steps, Hong Kong seeks not only to solidify its reputation as a financial hub but also to lead innovation in the digital currency space, carving out a central role in the global crypto economy.
The content on The Coinomist is for informational purposes only and should not be interpreted as financial advice. While we strive to provide accurate and up-to-date information, we do not guarantee the accuracy, completeness, or reliability of any content. Neither we accept liability for any errors or omissions in the information provided or for any financial losses incurred as a result of relying on this information. Actions based on this content are at your own risk. Always do your own research and consult a professional. See our Terms, Privacy Policy, and Disclaimers for more details.
Articles by this author
