In a significant development, Hong Kong has awarded its inaugural stablecoin issuer licenses to HSBC and Anchorpoint Financial, a joint venture led by Standard Chartered that includes Animoca Brands. This move marks the first batch of approvals under the Stablecoins Ordinance, which was implemented in August 2025.
According to Eddie Yue, the chief executive of the Hong Kong Monetary Authority (HKMA), the territory's central bank, the issuers are expected to launch their operations in line with their plans while effectively managing risks. Yue expressed hope that the promotion of regulated stablecoins will address existing challenges in financial and economic activities, create value for both individuals and businesses, and support the healthy development of digital assets in Hong Kong.
The HKMA evaluated 36 applications and had indicated that the initial round of approvals would be limited. Financial Secretary Paul Chan stated in his February budget address that only a small number of licenses would be granted, with the regulator prioritizing risk management, reserve quality, and anti-money-laundering controls. The decision to license note-issuing banks first appears to be a deliberate move, as HSBC and Standard Chartered are two of the three commercial banks authorized to print Hong Kong dollar banknotes, a system that dates back to 1846.
Today, each note-issuing bank deposits U.S. dollars with the government's Exchange Fund at a fixed rate and receives Certificates of Indebtedness in return, against which it prints banknotes.
In a blog post, Yue drew a parallel between the historical context of banknotes issued by commercial banks in exchange for deposited silver and stablecoins, which function as their blockchain-based equivalent. The licenses are subject to one of the world's strictest Know Your Customer (KYC) frameworks for digital money, requiring licensed stablecoins to be transferred only to wallets whose owners have been identity-verified. This implies that HKD stablecoins will likely embed compliance checks into their smart contracts, restricting transfers to wallets listed in an on-chain white list.
The bank-led stablecoin model reflects the HKMA's decision to deprioritize its central bank digital currency for retail use, following an 11-group pilot program that found the retail case was weak. Instead, stablecoins have become a key focus area, with Standard Chartered CEO Bill Winters stating that Hong Kong's push into stablecoins and tokenized deposits could lay the foundation for a new era of digital trade settlement. However, it remains to be seen whether the market will respond positively to this development.
With stablecoins being a roughly $310 billion asset class dominated by USD-denominated tokens, Hong Kong is betting that regulated, bank-issued HKD stablecoins can carve out a role in regional trade settlement. The question is whether a non-dollar stablecoin, however tightly regulated, can build the necessary network effects to compete.