Hong Kong strengthens stablecoin regulation: Starting from August 1, promoting without a license is prohibited, otherwise it will be considered a crime.

The Hong Kong Monetary Authority (HKMA) announced that, starting from August 1, 2025, unlicensed stablecoins will not be able to be promoted to the public in Hong Kong. This move is aimed at addressing excessive market enthusiasm and protecting retail investors from speculation and fraudulent activities. As Hong Kong's "Stablecoin Ordinance" is about to come into effect, the regulatory framework has gradually become clearer, and it is expected to influence global stablecoin regulatory trends.

Hong Kong Strengthens Stablecoin Regulations, Prohibits Unlicensed Stablecoin Public Promotion

The Hong Kong Monetary Authority (HKMA) issued a notice on July 23, reminding the public to be aware of the speculation surrounding stablecoins in the market, particularly the promotion of unlicensed stablecoins. According to the upcoming "Stablecoin Regulation," starting from August 1, any stablecoin that has not been approved by the HKMA shall not be promoted or marketed to the public in Hong Kong. This measure aims to prevent excessive speculation and ensure the sound development of the market.

The regulatory framework is gradually being implemented, with over 40 institutions having submitted applications for stablecoin licenses

Hong Kong is actively promoting the compliant development of stablecoins, with over 40 institutions consulting or applying for stablecoin licenses from regulators. However, many applications are still in the preliminary stage and lack viable business plans and risk management capabilities. It is expected that the Hong Kong Monetary Authority will approve some stablecoin licenses later this year and will bring the issuance and service providers of stablecoins under strict regulatory oversight.

Strict requirements for stablecoin endorsement and licensing, reducing market speculation

According to the "Stablecoin Regulation", all stablecoins must be fully backed by high-quality liquid reserves, which must consist of cash, bank deposits, or government bonds, and must be held by a trust institution, independent of the company's assets, to ensure that they are not subject to creditor claims in the event of the company's bankruptcy. Additionally, only a limited number of licenses will be approved, and unlicensed stablecoins are restricted to professional investors.

Global stablecoin regulation tightens, Hong Kong keeps pace with international developments

As global attention on stablecoin regulation intensifies, this move by Hong Kong also indicates that the region is actively responding to international regulatory trends. The Bank for International Settlements (BIS) recently warned that stablecoins could be used for money laundering activities, especially in cross-border transactions. Meanwhile, the United States passed a landmark stablecoin legislation this month, marking the beginning of a more stringent regulatory era for the stablecoin market worldwide.

The stablecoin market in Hong Kong shows healthy development potential

The Chief Executive of the Hong Kong Monetary Authority, Eddie Yue, stated that Hong Kong will implement more rigorous regulatory measures to ensure the stablecoin market can develop healthily and orderly. He mentioned that while initial regulatory requirements may restrict the rapid expansion of stablecoin businesses, this will help ensure the long-term stability of the market. It is expected that Hong Kong will issue detailed guidelines for the licensing regime for stablecoin issuers to provide a clear operational process for companies intending to apply for a license.

Conclusion: Hong Kong's regulatory framework for stablecoins is about to come into effect, marking the market's gradual shift towards compliance and robust development. Although it may temporarily restrict the expansion of some institutions, this regulatory measure is expected to inject more transparency and security into the market, preventing speculation and risks. As global regulations tighten, Hong Kong's regulatory policies will undoubtedly become an important reference for the development of stablecoins worldwide.