Hong Kong to implement stablecoin regulations this August... "Enhancing global competitiveness"

Hong Kong will begin implementing stablecoin regulations from August. The financial authorities are planning to use this as an opportunity to attract the issuance of stablecoins by global licensed institutions and significantly enhance the competitiveness of Hong Kong's financial market.

Paul Chan, the Hong Kong Financial Secretary, stated on the official website on the 16th (local time), "As the digital asset market is growing rapidly, the demand for stablecoins will also increase," adding, "With the new regulations taking effect from the 8th, the Monetary Authority (HKMA) will promptly process license applications so that qualified issuers can run their businesses as soon as possible."

He explained, "The global stablecoin market capitalization reaches about $240 billion, and the trading volume exceeded $20 trillion as of last year," and "many market participants are showing great interest in Hong Kong's new system."

Hong Kong is counted among the first major jurisdictions in the world to establish specific regulations on stablecoin issuance. The related ordinance, effective August 1st, makes it mandatory for stablecoin issuers to acquire a license and provides a clear regulatory framework for virtual assets (cryptocurrencies) linked to fiat currencies such as the US dollar.

Chan emphasized, "Hong Kong has pursued stablecoin development cautiously but steadily," and "is providing a new paradigm to the global market." He explained, "Hong Kong has adopted a more open model," allowing licensed issuers to issue stablecoins based on various fiat currencies. He added, "This will allow a variety of institutions to issue stablecoins in Hong Kong according to actual use cases by region, and greatly boost the liquidity of related activities and the competitiveness of the market."

Additionally, Secretary Chan evaluated stablecoins as a means that combines the 'security and efficiency' of blockchain with the 'stability' of fiat currencies, and said that they could serve as a tool connecting the financial system and the real economy. He noted that this can overcome the conventional limits of payment times and locations and further promote the automation of financial services.

Finally, he concluded, "We will continue to improve Hong Kong's business environment to enhance global competitiveness," and "it is important to properly communicate the stories of Hong Kong and China both internally and externally."