In a significant development for the financial sector in Hong Kong, the territory has awarded its first licenses to issue stablecoins to a group comprising HSBC and Anchorpoint Financial, a joint venture backed by Standard Chartered and Animoca Brands. This move marks the first batch of approvals under the Stablecoins Ordinance, which became effective in August 2025. According to Eddie Yue, Chief Executive of the Hong Kong Monetary Authority (HKMA), the regulatory body is looking forward to the licensed issuers commencing operations as planned, while effectively managing associated risks. The decision to grant licenses to these prominent banking institutions is seen as a deliberate move, given their historical role in issuing banknotes in Hong Kong.
The HKMA received 36 applications but had indicated that only a limited number would be approved in the initial round, with a focus on risk management, reserve quality, and anti-money laundering controls. The introduction of regulated stablecoins is expected to 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. Notably, 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 undergone identity verification.
This regime is likely to result in HKD stablecoins embedding compliance checks into their smart contracts, restricting transfers to wallets listed in an on-chain white list. The development of stablecoins in Hong Kong also reflects the HKMA's decision to prioritize the bank-led stablecoin model over the central bank digital currency (CBDC) for retail use. Standard Chartered CEO Bill Winters has stated 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 embrace this new development, given the dominance of USD-denominated tokens in the stablecoin market.