Regulation
Hong Kong to introduce regulatory framework for stablecoins by 2025
Hong Kong’s financial regulators received more than 100 submissions from market participants, the vast majority of which supported the establishment of a licensing regime for stablecoins.
The Financial Services and Treasury Bureau (FSTB) and the Hong Kong The Hong Kong Monetary Authority (HKMA) has published the results of a consultation paper on a proposal to introduce a regulatory regime for Stable Coin transmitters.
According to a press release issued on Wednesday, a “vast majority” of the 108 respondents agreed that with the increasing prevalence and evolving development of virtual assets, a regulatory regime should be introduced for stablecoin issuers. HKMA Chief Executive Eddie Yue said a well-regulated environment could be “conducive” to the “sustainable and responsible development of the stablecoin ecosystem in Hong Kong.”
The FSTB and the HKMA have indicated that they will take into account the comments received when finalising the legislative proposal to implement the regulatory regime. Reports indicate that the framework will be presented to lawmakers by the end of this year.
Hong Kong does not currently have a specific regulatory framework for stablecoin issuers, although the HKMA is the primary regulator overseeing the regulation of stablecoins and other cryptocurrencies in the region. Under the new proposal, stablecoin issuers in Hong Kong would be required to obtain a license. However, it is unclear whether they would be allowed to hold reserve assets with licensed banks in Hong Kong or other jurisdictions.
In the meantime, China accelerates its pilot project for a central bank digital currency, also known as digital yuanin local stores in Hong Kong. reported According to crypto.news, the use of the so-called “e-CNY” is limited to Hong Kong residents only, allowing them to top up their digital wallets with up to CNY 10,000 (roughly $1,380) via 17 retail banks in Hong Kong, including Standard Chartered Bank, ZA Bank, and DBS Bank.