hkd

Hong Kong is moving from regulatory planning to execution in its digital asset governance as it prepares to issue its first stablecoin issuer licenses this March. The initiative, announced by the Hong Kong regulator targets March for first stablecoin licences (Reuters), marks a significant milestone in implementing the Stablecoins Ordinance that came into force last year.

The Hong Kong Monetary Authority (HKMA) is finalizing the review of license applications and plans to grant only a limited number of approvals in the initial round. According to HKMA Chief Executive Eddie Yue, assessments are being conducted with an emphasis on use case viability, risk management frameworks, anti-money-laundering measures (AML), and the quality and backing of stablecoin assets — all critical factors for safeguarding investor interests and ensuring system stability.

Stablecoins are a class of digital assets designed to maintain a stable value, usually pegged to a fiat currency. With the ordinance’s regulatory framework now active, any operator seeking to issue a fiat-referenced stablecoin within Hong Kong must obtain a license from the HKMA before launch. This structure aims to bring clarity and discipline to an area that has historically seen uneven oversight worldwide.

The regulator’s cautious approach — granting only a small number of approvals at first — underscores a priority on market integrity and compliance readiness over rapid expansion. Licensed issuers will be required to meet ongoing compliance standards, particularly in AML controls, and adhere to Hong Kong’s regulatory regime for cross-border activities.

Industry watchers see this licensing initiative as part of a broader strategy to position Hong Kong as a credible digital finance hub in Asia, offering a regulated pathway for stablecoin markets that balance innovation with financial stability.

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