The Hong Kong Monetary Authority (HKMA) will enforce new stablecoin rules starting Friday, introducing a six-month transition period. According to Radio Television Hong Kong, issuers will receive temporary licenses if they meet regulatory requirements.
Issuers failing to comply within three months must close operations in the following four months. If the HKMA decides an issuer cannot meet the rules, it will order closure within one month of notice. The HKMA confirmed it will grant only a limited number of licenses initially and will not disclose applicant names.
The HKMA stated that temporary licenses will only be valid if issuers show they can meet the full stablecoin rules during this transition. Regulatory powers will remain active throughout the period.
Strict Requirements for Stablecoin Issuers in Hong Kong
The new stablecoin rules require issuers to fully back their tokens with high-quality liquid reserves. They must process redemption requests within one business day and maintain a physical office in Hong Kong. Adequate financial resources are mandatory for license eligibility.
Additional measures include Know Your Customer (KYC) checks, wallet ownership verification, continuous transaction monitoring, and blacklisting of high-risk wallet addresses. These rules aim to strengthen control over stablecoin issuers and prevent misuse.
The HKMA will investigate suspected noncompliance. Enforcement tools include fines, public warnings, license suspension or revocation, and referrals to law enforcement. Authorities will also criminalize the promotion of unlicensed stablecoin services.
Rising Demand for Stablecoin Licenses in Hong Kong
Interest in licenses has increased ahead of the stablecoin rules launch. JD.com registered two entities through a subsidiary linked to a stablecoin plan just days before enforcement begins. The company also participates in Hong Kong’s stablecoin sandbox program.
Ant International, part of Alibaba Group, plans to apply for licenses in both Hong Kong and Singapore. Its parent company runs Alipay, which serves 1.3 billion users and 80 million merchants globally.
In February, Standard Chartered Bank Hong Kong, Animoca Brands, and Hong Kong Telecommunications announced a joint venture to issue a Hong Kong dollar-backed stablecoin. These firms are preparing ahead of the HKMA stablecoin framework rollout.
HKMA Licensing and Enforcement Approach
The HKMA confirmed it will not reveal timelines for issuing licenses or applicant identities. It will approve only a limited number of licenses in the initial phase. The regulator stressed that all enforcement actions under the stablecoin rules will take effect during the transition period.
This move follows other initiatives in Hong Kong’s stablecoin framework, including preparation for a third batch of tokenized bonds and measures targeting unlicensed promotions.
