On August 1, Hong Kong’s stablecoin ordinance officially took effect, covering all activities related to stablecoins, licensing of stablecoin issuers, and ongoing oversight of licensees. Under the new framework, any entity seeking to issue fiat-backed stablecoins or promote related issuance activities in Hong Kong must first obtain a stablecoin issuer license from the Hong Kong Monetary Authority (HKMA).
One of the most closely watched components—the licensing regime and application process—also launched on August 1. The HKMA had previously issued detailed guidance outlining licensing procedures, regulatory expectations, and specific application requirements. Eligible institutions have until September 30 to apply.
Applicants must be either companies incorporated in Hong Kong or recognized institutions based abroad. They must also demonstrate adequate financial strength and liquidity, including a minimum paid-up capital of HKD 25 million (USD 3.2 million) or its equivalent in freely convertible foreign currency. Additional requirements include robust standards for risk management, compliance, and disclosure.
In the US, stablecoin regulation also advanced in July. On July 18 local time, President Donald Trump signed the “Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act” into law. The legislation establishes a formal framework for stablecoin issuance in the US, allowing only approved issuers to issue payment stablecoins and setting requirements for asset reserves, risk controls, and broader oversight.
Following the rollout of these regulatory frameworks, initial enthusiasm for stablecoins surged, then began to cool.
Under Hong Kong’s ordinance, a digital asset qualifies as a stablecoin if it meets the following criteria:
- Serves as a unit of account or store of economic value.
- Accepted by the public as a medium of exchange, for payments, debt settlement, or investment.
- Transferable, storable, or tradable electronically.
- Operates on a distributed ledger or similar infrastructure.
- Maintains a stable value by referencing a single asset, a group of assets, or a basket of assets.
Unlike other volatile cryptocurrencies, stablecoins are typically pegged to fiat currencies to ensure price stability, serving as a bridge between traditional finance and blockchain-based systems.
The HKMA also requires issuers to demonstrate real-world use cases. Cross-border payments and real-world asset (RWA) tokenization are expected to be key applications. Bian Zhuoqun, vice president at Ant Group and president of blockchain at Ant Digital Technologies, has noted that stablecoins hold substantial potential as connectors between traditional finance and tokenized assets. Their value, he argued, lies in expanding utility and ensuring regulatory compliance.
With HKMA support, Ant Digital Technologies has already completed RWA tokenization projects involving charging stations, photovoltaics, and two-wheeler battery swapping.
Ahead of the ordinance, companies including Ant Group and JD.com expressed interest in applying for licenses. Both Ant International and Ant Digital Technologies confirmed plans to apply in Hong Kong. JD also announced its intent to seek stablecoin licenses in major currency jurisdictions globally. Its affiliate, Jingdong Coinlink Technology, is listed as a sandbox participant for stablecoin issuance.
Amid this momentum, stablecoin concept stocks in mainland China experienced multiple rounds of gains. But as regulatory frameworks solidified and official positions grew more cautious, early market enthusiasm began to fade. On August 1, the day the ordinance took effect, stablecoin-related stocks in both A-shares and Hong Kong markets saw broad declines.
The HKMA has repeatedly called for a tempered view of the stablecoin sector. In a July article, HKMA chief executive Yu Weiwen noted that only a few licenses will be granted in the initial phase. Deputy chief executive Chen Weimin echoed that sentiment, stating no timeline has been set and the first licenses may not be issued until early 2026.
As Yu wrote, regulated stablecoin businesses remain in their early stages. The HKMA’s measured approach, he emphasized, is aimed at building sustainable growth, starting with strong guardrails rather than backtracking from a loose start.