Hong Kong officially implemented its comprehensive stablecoin regulatory framework on August 1, 2025, through the Stablecoins Ordinance.
This legislation requires anyone issuing stablecoins tied to the Hong Kong dollar, whether domestically or abroad, to obtain a license from the Hong Kong Monetary Authority (HKMA). The regulation aims to ensure financial stability and protect investors by enforcing strict requirements: issuers must maintain minimum capital levels, fully reserve stablecoins with high-quality liquid assets, and comply with robust operational and risk management standards.
Despite the regulatory safeguards, the HKMA has warned the public about potential fraud risks associated with stablecoins. It cautioned against people or entities falsely claiming to be licensed stablecoin issuers or license applicants, which is now an offense under the new law.
The HKMA emphasized that only stablecoins issued by licensed entities can be offered to retail investors. The public is urged to remain vigilant and avoid unlicensed stablecoins, which carry higher risks.
Industry concerns have also surfaced regarding stringent customer identification rules that may complicate stablecoin adoption and hinder Hong Kong's competitiveness in the global digital finance space. Nonetheless, the framework represents a major step toward positioning Hong Kong as a leading international hub for virtual assets by balancing innovation, market access, and risk mitigation.
Hong Kong's new stablecoin rules bring rigorous supervision to the market while warning about fraud risks to protect consumers and maintain financial integrity.
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