Unregulated Hong Kong Stablecoins Emerge Amid Official Absence

Hong Kong’s financial regulator has cautioned that fake stablecoins are taking advantage of the city’s new stablecoin framework before any officially approved products have been released. The Hong Kong Monetary Authority stated that tokens bearing the ‘HKDAP’ and ‘HSBC’ labels are being traded, but are not associated with any licensed issuers. The two applicants for stablecoin licenses mentioned in related media reports have confirmed that they have not issued any regulated stablecoins. Earlier this month, the HKMA awarded its first stablecoin licenses under the newly effective Stablecoins Ordinance, selecting two groups out of 36 applicants. The selection of these groups mirrors the existing banking system in Hong Kong, where a limited number of banks are authorized to issue currency. The HKMA has warned the public to be cautious of scams and to only rely on official announcements from licensed issuers, as well as to conduct transactions through authorized channels. Industry insiders anticipate the launch of licensed stablecoins to occur during Hong Kong’s fintech week in November.