Stablecoin News – Hong Kong’s upcoming stablecoin licensing regime, set to launch on August 1, 2025, has attracted applications from over 40 companies, including Chinese giants like JD.com and Ant Group, as reported by Bloomberg on July 8. The Hong Kong Monetary Authority (HKMA) is preparing to issue licenses that require issuers to maintain full reserve backing, comply with AML regulations, and demonstrate viable use cases, particularly for business-to-business transactions.
However, only a handful of applicants are expected to secure approval by year-end, reflecting the HKMA’s cautious approach to financial stability. The licensing framework aims to position Hong Kong as a digital finance hub, focusing on HKD and offshore yuan-pegged stablecoins to reduce reliance on U.S. dollar-based tokens like USDT.
Financial Secretary Christopher Hui emphasized cost efficiencies in cross-border payments, aligning with Asia’s push for local currency trade. The “LEAP” policy, promoting legal clarity and ecosystem growth, has spurred market optimism, with crypto stocks like Victory Securities rising 10% on July 7. Social media posts on July 8 noted Hong Kong’s progressive stance, with one user predicting a “stablecoin boom” in the region.
Yet, the high bar for approval mirrors Hong Kong’s selective virtual asset licensing, where only 11 platforms have been approved. Applicants face challenges like proving reserve audits and navigating global regulatory pressures. The U.S.’s faster-moving stablecoin market, bolstered by the GENIUS Act, could outpace Hong Kong’s efforts. Despite this, the competition among 40+ firms underscores the global race to dominate stablecoin issuance, with Hong Kong’s success hinging on balancing rigor and innovation.
