On May 21, 2025, the Hong Kong Legislative Council passed a new law regulating stablecoins, attracting attention from fintech companies from mainland China.
Goals of the New Stablecoin Legislation
The new stablecoin law in Hong Kong aims to regulate fiat-referenced stablecoins. The Hong Kong Monetary Authority (HKMA) developed this framework to ensure digital payment stability and increase market liquidity. "Stablecoins could enhance market liquidity and improve digital payment and settlement systems," stated HKMA.
Interest from Chinese Fintech Firms
Mainland Chinese fintech firms have shown significant interest in the new ordinance. These companies are considering applying for licenses to issue stablecoins in Hong Kong, indicating strategic opportunities.
Comparison with European Standards
Experts believe the new law could transform the digital asset landscape, enhancing liquidity and innovation. The interest from mainland firms suggests confidence in Hong Kong's regulatory environment. Similar regulatory approaches, such as the EU’s MiCA regulations, have fostered partnerships between traditional finance and digital asset sectors.
Thus, the new stablecoin legislation in Hong Kong has the potential to significantly impact the financial sector, promoting new technologies and bolstering the market.
