- Hong Kong delays stablecoin licenses, aiming to enforce stringent criteria.
- First license issuance is postponed until early next year.
- High regulatory hurdles exist for stablecoin applicants in Hong Kong.
Hong Kong’s stablecoin licensing initiative, led by the HKMA, is facing regulatory challenges, with no licenses issued despite the regime’s planned implementation in August 2025.
The delay highlights critical regulatory hurdles, impacting potential market adoption and concentration among larger firms, with applicants now awaiting approvals not expected before early 2026.
Hong Kong’s new Stablecoin Licensing regime set for August 2025 faces regulatory challenges and delays. The Hong Kong Monetary Authority (HKMA) has not issued any licenses yet and is focusing on a high-standard regulatory approach.
Chief Executive Eddie Yue from the HKMA emphasized that no licenses have been issued, urging public caution. “No licence has been issued by the HKMA,” Eddie Yue noted. Darryl Chan, Deputy CEO, confirmed the absence of specific targets for license numbers due to high regulatory standards.
No stablecoin licenses have been issued, impacting potential applicants and delaying market onboarding. The licensing process has pushed back applications until August 31, 2025, with approvals expected early next year.
High regulatory bars focus on ensuring 1:1 reserves in liquid assets, impacting how stablecoins like USDT or USDC potentially operate from Hong Kong in the future.
Affected stablecoin issuers must demonstrate daily redemption capabilities and maintain a physical presence in Hong Kong. Future effects on ETH, BTC, or DeFi ecosystems pending until license issuance. The shifts in these areas are expected as Hong Kong gradually implements its framework. Darryl Chan, the Deputy CEO, stated, “We do not expect to achieve large-scale [stablecoin adoption] immediately in the early stages… We aim to progress step by step, gradually driving the digital transformation of Hong Kong.” Darryl Chan.
Expect financial, regulatory, and technological shifts as Hong Kong gradually implements its stablecoin framework, drawing insights from global best practices seen in the EU’s MiCA and Singapore’s Payment Services Act.
