Hong Kong is working to incorporate stablecoins into the region's legal framework to regulate digital assets.
Before officially becoming law, the draft will undergo three rounds of rigorous review, including debate, deliberation, and necessary amendments. Once it passes the final assessment, the bill will be submitted to the Chief Executive of the Hong Kong Special Administrative Region for signature to become law.
Before officially becoming law, the draft will undergo three rounds of rigorous review, including debate, deliberation, and necessary amendments. Once it passes the final assessment, the bill will be submitted to the Chief Executive of the Hong Kong Special Administrative Region for signature to become law.
The draft will undergo three rounds of rigorous review, including debate, review, and necessary amendments will undergo three rounds of rigorous review, including debate, review, and necessary amendments.
The bill focuses primarily on three pillars: issuer licensing requirements, stablecoin issuance processes, user protection measures, and marketing guidelines. After the law is enacted, any organization wishing to issue stablecoins in Hong Kong must obtain a license from the Hong Kong Monetary Authority (HKMA). To qualify, issuers must meet stringent requirements regarding capability, reserve assets, and price stability mechanisms.
The bill could bring transformative changes to the market, akin to the impact of the European MiCA regulation. According to a report by research firm Kaiko and exchange Bitvavo on December 18, MiCA has significantly reshaped the landscape of stablecoins in Europe. While issuers like Tether have exited the issuance of euro-denominated stablecoins, organizations compliant with MiCA are thriving. By November 2024, three entities—Circle, Société Générale, and Banking Circle—will account for 91% of the compliant stablecoin market share.