- Mandatory stablecoin licensing in Hong Kong starts August 2025.
- HKMA oversees compliance and issuance of licenses.
- The ordinance applies to fiat-referenced stablecoins.
Hong Kong’s introduction of the Stablecoins Ordinance on August 1, 2025, requires stablecoin issuers to obtain licenses, affecting major players like Tether and Circle. The ordinance mandates rigorous reserve management, enhancing compliance and establishing a competitive landscape for licenses.
Hong Kong’s regulatory move aims to foster financial stability and market legitimacy while involving major players and exchanges.
The Stablecoins Ordinance enacted by Hong Kong on August 1, 2025, necessitates a mandatory licensing regime for fiat-referenced stablecoin issuers, with the Hong Kong Monetary Authority (HKMA) setting a compliance deadline. The ordinance addresses stablecoins referencing the Hong Kong dollar or catering to Hong Kong consumers, highlighting robust compliance requirements.
Major exchanges and stablecoin issuers, though yet to respond officially, face new operational structures under this regime. The policy impacts fiat-backed stablecoins, while BTC and ETH remain unaffected unless used as collateral for these stablecoins.
The financial implications include higher operational costs due to mandated reserve management, reflecting similar actions by the EU and UK, thus increasing compliance costs but enhancing market legitimacy.
“The introduction of the Stablecoins Ordinance may increase compliance costs for issuers but is expected to elevate the legitimacy of the market.” – Tina Lee, Partner, Mayer Brown
This initiative by HKMA may inspire similar regulatory actions elsewhere. Historic parallels indicate increased institutional trust and entry into regulated markets amid heightened regulatory scrutiny.
About the author
Beijing Initiates Crypto Asset Disposal via Hong Kong Exchange
Beijing has officially implemented a mechanism to manage digital assets through Hong Kong-licensed exchanges, directing funds to the national treasury.
Elon Musk Announces Real-time AI Video Rollout
Elon Musk's xAI reveals plans for real-time AI video launch targeting October 2025.
1,000 BTC Transferred from Coinbase to Unknown Wallet
A significant transaction of 1,000 BTC was observed from Coinbase to an unknown wallet, indicating ongoing whale activity in the market.
Coinbase Launches UK Campaign with Satirical Theme
Coinbase's new UK campaign 'Everything Is Fine' uses satire to critique the economic situation and promote crypto as a modern choice.
Arkham Identifies LuBian Crypto Theft Behind 127,426 BTC Loss
Arkham Intelligence discloses LuBian's major BTC theft from 2020, showing $14.5B in stolen assets.
Ethereum Whale Buys $300M ETH Amid Market Volatility
Ethereum whale buys $300M ETH through Galaxy Digital, facing $26M loss.
Related
Beijing Initiates Crypto Asset Disposal via Hong Kong Exchange
Beijing has officially implemented a mechanism to manage digital assets through Hong Kong-licensed exchanges, directing funds to the national treasury.
Elon Musk Announces Real-time AI Video Rollout
Elon Musk's xAI reveals plans for real-time AI video launch targeting October 2025.
1,000 BTC Transferred from Coinbase to Unknown Wallet
A significant transaction of 1,000 BTC was observed from Coinbase to an unknown wallet, indicating ongoing whale activity in the market.
Coinbase Launches UK Campaign with Satirical Theme
Coinbase's new UK campaign 'Everything Is Fine' uses satire to critique the economic situation and promote crypto as a modern choice.
Arkham Identifies LuBian Crypto Theft Behind 127,426 BTC Loss
Arkham Intelligence discloses LuBian's major BTC theft from 2020, showing $14.5B in stolen assets.
Ethereum Whale Buys $300M ETH Amid Market Volatility
Ethereum whale buys $300M ETH through Galaxy Digital, facing $26M loss.
Be the first to leave a comment