The Hong Kong Monetary Authority has issued its first stablecoin licenses to HSBC and Anchorpoint Financial, a joint venture led by Standard Chartered that includes Animoca Brands, in a move that signifies the first batch of approvals under the Stablecoins Ordinance implemented in August 2025. According to HKMA Chief Executive Eddie Yue, "We anticipate that these issuers will initiate their operations as planned, exploring growth opportunities while effectively managing associated risks." Yue further expressed his hopes that the promotion of regulated stablecoins would address existing challenges in financial and economic activities, create value for individuals and businesses, and support the healthy development of digital assets within Hong Kong. The HKMA evaluated 36 applications, and as signaled earlier, the initial round of approvals was limited.
Financial Secretary Paul Chan had mentioned in his February budget address that only a limited number of licenses would be granted, with the regulator prioritizing risk management, reserve quality, and anti-money-laundering controls. It appears that the decision to license note-issuing banks first was a deliberate move, given that HSBC and Standard Chartered are among 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 from December 2023, Yue drew parallels between pre-1935 banknotes issued by commercial banks in exchange for deposited silver and stablecoins, suggesting that both function as forms of private money or tokens with stable value that can serve as a medium of exchange. The licenses are accompanied by one of the world's strictest Know Your Customer (KYC) frameworks for digital money, requiring that licensed stablecoins can only be transferred to wallets whose owners have undergone identity verification. This implies that HKD stablecoins will likely incorporate compliance checks into their smart contracts, restricting transfers to wallets listed in an on-chain white list, making them distinct from freely transferable tokens.
Furthermore, the bank-led stablecoin model reflects the HKMA's decision to deprioritize its central bank digital currency (CBDC) for retail use, following an 11-group pilot program that found the retail case to be weak. The focus on stablecoins and tokenized deposits could potentially lay the foundation for a new era of digital trade settlement, as suggested by Standard Chartered CEO Bill Winters. However, it remains to be seen whether the market will embrace this development, given that stablecoins are a $310 billion asset class dominated by USD-denominated tokens. Hong Kong is betting on regulated, bank-issued HKD stablecoins to carve out a role in regional trade settlement, but the question is whether a non-dollar stablecoin can build the necessary network effects to compete.