Eddie Yue: Hong Kong Sets Relatively Strict Standards for Stablecoin Issuers, Expects Only a Few Licenses to Be Granted in the First Phase

Hong Kong’s Stablecoin Ordinance will take effect on August 1. Eddie Yue, Chief Executive of the Hong Kong Monetary Authority (HKMA), stated that Hong Kong has set relatively stringent standards for stablecoin issuers, with high entry thresholds that are almost on par with the regulation of e-wallets and banks. It is expected that only a few licenses will be issued in the first phase, and the licensed stablecoins will serve specific purposes, such as cross-border trade. Yue also mentioned that the HKMA has very strict requirements for risk management, whether it is asset reserve management, stabilization mechanisms, redemption policies, or, most importantly, anti-money laundering regulations, which are nearly identical to those for e-wallets and banks. Since stablecoins have payment attributes, the Stablecoin Ordinance provides issuers with a comprehensive regulatory framework to ensure that the same risks are subject to the same regulatory rules, and to promote the healthy and sustainable development of the industry. (Jin10)