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Hong Kong is preparing to launch its long-awaited stablecoin ordinance on August 1, 2025, a move that could position the city as a credible player in the evolving global digital finance landscape.
In recent remarks, HKMA Chief Executive Eddie Yue emphasized the need for a cautious and sustainable rollout, warning against market euphoria and underscoring the importance of consumer protection, regulatory clarity, and responsible innovation.
Under the new framework, any entity issuing stablecoins referenced to fiat currencies will be required to obtain a license from the Hong Kong Monetary Authority before operating or marketing their product in the city. The regulation adopts a risk-based approach “same activity, same risks, same regulation” and is designed to prioritize issuers with robust reserve management, liquidity safeguards, and transparent redemption mechanisms.
While some jurisdictions have opted for looser frameworks, Hong Kong is signaling its intent to avoid shortcuts. The ordinance introduces high entry standards for all fiat-referenced stablecoins, particularly those tied to the Hong Kong dollar. Requirements include clear proof-of-reserves, sound governance structures, client asset segregation, and compliance with anti-money laundering obligations.
The move comes as regulators worldwide scramble to bring stability and oversight to the stablecoin space. From the European Union’s MiCA framework to the proposed GENIUS Act in the U.S., the global shift toward regulating private digital currencies is gaining momentum.
By introducing licensing and operational requirements, Hong Kong hopes to provide clarity without stifling innovation. Yue reiterated that stablecoins are not speculative assets, they are meant to function as payment instruments. The ordinance aims to support real-world use cases like cross-border payments, trade settlement, and programmable money, rather than fuel high-risk investment schemes.
Still, Yue acknowledged that some startups may find the early-stage standards demanding. But, he added, credibility is non-negotiable. Hong Kong is building for the long term, not chasing hype cycles.
The ordinance is expected to enter into force on August 1, beginning with a sandbox phase that will allow early applicants to test their models under regulatory supervision. The HKMA is also expected to release detailed guidance and continue engaging with industry players through consultations.
As global attention increasingly turns to stablecoins as a bridge between traditional finance and crypto, Hong Kong’s regulatory stance stands out as cautious, clear, and committed to balancing innovation with accountability.
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