Regulation
Hong Kong to unveil stablecoin regulatory framework by 2025
Hong Kong’s financial regulators have received over 100 proposals from market participants, most of which support the establishment of a stablecoin licensing regime.
The Financial Services and Treasury Bureau (FSTB) and the Hong Kong The HKMA has published the results of a consultation paper on a proposal to introduce a regulatory regime for stable currency broadcasters.
According to a press release on Wednesday, a “vast majority” of the 108 respondents agreed that with the growing prevalence and evolution of virtual asset development, a regulatory regime should be introduced for stablecoin issuers. HKMA Director General 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 HKMA noted that they would take the feedback into account in finalising the legislative proposal for the implementation of the regulatory regime. Reports indicate that the framework will be presented to regulators by the end of this year.
Hong Kong currently does not have a specific regulatory framework for stablecoin issuers, although the HKMA acts as the primary regulatory body overseeing the regulation of stablecoins and other cryptocurrencies in the region. Under the new proposal, Hong Kong stablecoin issuers would be required to obtain a license. However, it remains unclear whether they would be allowed to hold reserve assets at licensed banks in Hong Kong or other jurisdictions.
In the meantime, China is accelerating its pilot project of a central bank digital currency, also known as digital yuanin local shops in Hong Kong. As 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 (about $1,380) through 17 Hong Kong retail banks, including Standard Chartered Bank, ZA Bank, and DBS Bank.