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 round of approvals under the Stablecoins Ordinance, which was enacted in August 2025. According to HKMA Chief Executive Eddie Yue, the authority looks forward to the licensed issuers commencing operations in line with their plans, while also ensuring the proper management of risks.
Yue expressed his hope that the promotion of regulated stablecoins would 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 received 36 applications and had indicated that the initial round of approvals would be limited. In his February budget address, Financial Secretary Paul Chan stated that only a small number of applicants would be approved, 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 December 2023 blog post, Yue drew parallels between pre-1935 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, which requires licensed stablecoins to be transferred only to wallets whose owners have undergone identity verification.
The travel rule applies to transfers exceeding HK$8,000 (~$1,000), which means 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 also 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 to be weak. The push into stablecoins and tokenized deposits could lay the foundation for a new era of digital trade settlement, according to Standard Chartered CEO Bill Winters. However, it remains to be seen whether the market will agree, given that stablecoins are 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, issued by the same institutions, under the same constraints, on new rails. The question is whether a non-dollar stablecoin, however tightly regulated, can build the necessary network effects to compete.