Hong Kong has revealed that it has activated licensing for issuers of fiat-based stablecoins amid a broader push for crypto regulatory clarity. During a policy briefing with the Legislative Council’s Finance Committee, Secretary for Financial Services and the Treasury, Christopher Hui, said the Stablecoin Ordinance was officially implemented last August, introducing a licensing system for fiat-denominated stablecoin issuers in Hong Kong, and that the Hong Kong Monetary Authority (HKMA) is currently processing relevant license applications. Hui framed crypto as a “new growth area” that could further reinforce the city as an international finance center.
Regulators are working on the details of the regulatory regime for virtual asset trading and custody service providers, as well as other aspects of digital asset markets. The Financial Services and the Treasury, and the SFC are also consulting the public on establishing a regulatory regime for service providers offering advice on virtual assets and virtual asset management service providers. Regulators are collecting feedback to strengthen anti-money laundering efforts and deter tax evasion. The first batch list of approved licensed stablecoin issuers in Hong Kong is expected in Q1 2026, according to the city’s Financial Secretary Paul Chan Mo-po.
During the World Economic Forum in Davos, the finance chief described digital assets as “financial innovation that we should embrace proactively” and said “we also believe digital assets should serve the real economy.” Mo-po stressed that the city must build strong guardrails to mitigate crypto market-related risks that could undermine broader financial stability, the overall market integrity, and protect investors. Hong Kong’s stablecoin bill requires strict standards for reserves, redemption, and risk measures. Similarly, it tightened rules on custodians and dealers, laying the groundwork for a broader crypto regulatory framework.
The move mirrors regulatory approaches in the U.K. and the U.S to offer clear rules for the growing sector. Notably, the U.S. passed its stablecoin bill last year, signaling a major step for digital assets, though the broader market structure bill, the CLARITY Act, remains uncertain. Contentious issues, such as yield and tokenized stocks, continue to stall its progress. In the U.K., Parliament recently launched a stablecoin inquiry to review the proposed regulatory regime that is set to be finalized by the end of 2026.
In the U.K., Parliament recently launched a stablecoin inquiry to review the proposed regulatory regime that is set to be finalized by the end of 2026. Hong Kong is gearing up to list its first batch of approved and licensed stablecoin issuers in Q1, underscoring officials’ view of crypto as a new growth area for the city. Top officials believe crypto is a “new growth” area to position Hong Kong as an international finance center.
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