In a landmark decision, Hong Kong has issued its inaugural stablecoin licenses to two prominent financial institutions: HSBC and Anchorpoint Financial, a joint venture led by Standard Chartered that includes Animoca Brands. This move follows the implementation of the Stablecoins Ordinance in August 2025. According to Eddie Yue, Chief Executive of the Hong Kong Monetary Authority, the regulator expects the licensed issuers to commence operations in line with their plans while maintaining robust risk management practices.
Yue expressed his hopes that the introduction of regulated stablecoins will address existing pain points in financial transactions, create value for both individuals and businesses, and support the healthy growth of digital assets in Hong Kong. The Hong Kong Monetary Authority received 36 applications for stablecoin licenses and has emphasized the importance of risk management, reserve quality, and anti-money-laundering controls in its evaluation process.
By prioritizing the city's note-issuing banks, such as HSBC and Standard Chartered, the regulator aims to leverage their expertise and stability in the financial sector. These banks have a long history of issuing banknotes in Hong Kong, dating back to 1846, and currently operate under a system where they deposit U.S. dollars with the government's Exchange Fund in exchange for Certificates of Indebtedness.
In a blog post, Yue drew parallels between the historical context of private banks issuing currency backed by silver deposits and the modern concept of stablecoins, which are essentially tokens with stable value that can facilitate transactions on blockchain platforms. The licenses granted by the Hong Kong Monetary Authority come with stringent Know-Your-Customer (KYC) requirements, mandating that licensed stablecoins can only be transferred to wallets whose owners have undergone identity verification.
Furthermore, the travel rule applies to transactions exceeding HK$8,000 (~$1,000), necessitating the implementation of compliance checks within smart contracts to restrict transfers to wallets listed on an on-chain white list. This approach differentiates HKD stablecoins from other freely transferable tokens like USDT or USDC.
The bank-led stablecoin model also reflects the HKMA's decision to deprioritize the development of a central bank digital currency (CBDC) for retail use, following an 11-group pilot program that concluded in October with underwhelming results for the retail case. Instead, the focus has shifted to stablecoins, which were a prominent topic at Hong Kong Fintech Week.
Standard Chartered CEO Bill Winters has emphasized the potential of stablecoins and tokenized deposits to lay the foundation for a new era of digital trade settlement, positioning them as a novel medium for cross-border commerce. However, it remains to be seen whether the market will embrace this vision. With stablecoins representing a roughly $310 billion asset class dominated by USD-denominated tokens, Hong Kong is betting on regulated, bank-issued HKD stablecoins to carve out a niche in regional trade settlement.
The key question is whether a non-dollar stablecoin, regardless of its regulatory framework, can build the necessary network effects to compete in the market.