2026 Hong Kong's first batch of stablecoin licenses will be issued! Standard Chartered, Ant Group, and JD.com Group are competing for a foothold

Ming Wai-Kwong announces at Davos the issuance of the first Hong Kong stablecoin licenses in 2026, the first comprehensive regulation in Asia. Capital threshold of HKD 25 million, must hold equivalent reserves and disclose daily. Standard Chartered, Ant, and JD.com compete for deployment. Global stablecoin market cap reaches USD 328 billion. Regulatory focus on reserve stability and cross-border risks.

Asia’s First Full Regulation, Hong Kong Seizes Digital Financial Discourse Power

Hong Kong Financial Secretary Paul Chan Mo-po officially announced at the Davos Forum that Hong Kong plans to issue its first fiat-backed Hong Kong stablecoin licenses within 2026. This marks Hong Kong as Asia’s first jurisdiction to fully incorporate privately issued stablecoins into the legal regulatory framework, a significant step in global digital financial governance. Against the backdrop of deep integration of digital economy and financial infrastructure, this measure aims to promote the standardized development of the stablecoin market under systemic regulation, while managing risks.

The strategic significance of being Asia’s first fully regulated jurisdiction is immense. While Singapore is also promoting stablecoin regulation, it has not yet established a complete licensing system. Japan and South Korea are relatively conservative on stablecoins and have not opened large-scale issuance. Hong Kong’s early establishment of a comprehensive regulatory framework will give it a first-mover advantage in Asia’s digital financial competition. When international organizations choose Asia as their headquarters, Hong Kong’s clear licensing system will be a key consideration.

By the end of 2025, the total global stablecoin market cap has reached approximately USD 328 billion, with peak daily settlement volume exceeding USD 100 billion. Its payment efficiency and cross-border liquidity have posed certain competitive pressures on traditional financial systems. Hong Kong’s institutionalized regulatory pathway aims to provide compliant development channels for such assets, balancing innovation and stability dynamically.

To ensure the stability and compliance of Hong Kong’s stablecoin issuance, a comprehensive supervision system covering legislation, testing, and access has been established, forming a multi-layered risk prevention mechanism. In August 2025, the “Stablecoin Issuers Ordinance” was officially implemented, establishing the legal basis for stablecoin issuance. The ordinance clearly states that unlicensed issuance is illegal, requiring all issuers to hold high-quality reserves of equivalent value and to disclose assets daily, enhancing market transparency and preventing information asymmetry risks.

Three-Stage Mechanism for Hong Kong Stablecoin Regulation

Legislation First: August 2025, implementation of the Stablecoin Issuers Ordinance, establishing legal foundation

Sandbox Testing: 2024-2025, HKMA sets up a supervisory sandbox to stress-test institutional capabilities

Licensing: First licenses issued in 2026, limited quantity with cautious screening

HKD 25 Million Threshold and Strict Reserve Asset Requirements

Hong Kong sets clear and strict supervisory standards for Hong Kong stablecoin issuers, reflecting high regard for financial security and investor protection. Regarding capital adequacy, applicants must have a paid-up capital of at least HKD 25 million and maintain sufficient liquidity buffers to handle potential runs or market volatility, ensuring basic risk absorption capacity.

The HKD 25 million (about USD 3.2 million) threshold may seem modest, but combined with other requirements, actual access becomes significantly more difficult. Reserve asset management requires that reserves be composed of cash or high-credit short-term government bonds, held independently by licensed local banks, ensuring asset segregation. This arrangement prioritizes safeguarding redemption rights and prevents misappropriation or related-party transaction risks.

This 100% reserve plus independent custody requirement makes Hong Kong stablecoins much safer than some market counterparts with under-collateralization or opaque reserves. For issuers, this means reserves cannot be used for investments or loans for profit, with revenue mainly derived from transaction fees and value-added services rather than capital utilization.

Regarding cross-border supervision, foreign-registered applicants must obtain written consent from their home regulators, reflecting Hong Kong’s coordinated stance in international financial supervision and strengthening transparent supervision and risk joint prevention. This rule is especially important for global stablecoin giants like Circle (USDC issuer), Tether (USDT issuer). They must obtain recognition from US or other home regulators to issue and operate in Hong Kong.

Three Core Standards for Hong Kong Stablecoin Access

Capital Threshold: HKD 25 million paid-up capital + liquidity buffer

Reserve Management: 100% high-quality assets + local bank independent custody

Cross-border Cooperation: Overseas institutions require written approval from their home regulators

Standard Chartered, Ant, and JD.com Compete for Deployment

With the licensing system imminent, market participants are deploying strategies based on their strengths, mainly falling into three categories. Among traditional financial institutions, Standard Chartered plans to launch multi-currency stablecoins to serve cross-border corporate payments; Ant Bank (Hong Kong) is exploring integrating its stablecoin products into existing payment systems to enhance retail transaction efficiency.

Standard Chartered’s multi-currency strategy is highly forward-looking. USDT and USDC are USD stablecoins, but cross-border trade involves EUR, GBP, JPY, and other currencies. If Standard Chartered can offer Hong Kong stablecoins pegged to multiple fiat currencies, it will meet real multi-currency settlement needs. As an established international bank, Standard Chartered’s experience in global compliance and risk control is its core advantage in obtaining licenses.

In the tech and industry sector, JD.com’s tech team has been established to explore applying stablecoins to global supply chain settlement, reducing transaction costs and improving cash flow efficiency. JD’s advantage lies in its access to vast real-world business scenarios and supply chain data. Integrating Hong Kong stablecoins into JD’s B2B payment system could quickly generate large-scale real usage.

Among local fintech firms, Yuanbi Technology leverages experience from its HKD stablecoin pilot, continuously optimizing cross-border payment solutions and participating in real-world asset tokenization (RWA) infrastructure. Hong Kong has successfully issued over USD 2.1 billion in tokenized green bonds, and Hong Kong stablecoins are expected to become core settlement tools, promoting deep integration of digital assets and the real economy.

The implementation of the licensing system is not only a market entry mechanism but also a strategic tool to guide resources toward high-compliance, high-value sectors. Licensed institutions will enjoy the trust conferred by regulatory approval, priority in cooperation with government and traditional financial systems, and the freedom to innovate within a regulated environment. This “compliance premium” will make licenses a scarce resource.

Three Major Challenges in Risk Management Test Regulatory Wisdom

Hong Kong regulators remain highly alert to systemic risks potentially triggered by stablecoins. HKMA Chief Executive Eddie Yue pointed out three key challenges. Regarding reserve stability, the quality and liquidity of reserves directly determine stablecoin redemption ability, requiring continuous monitoring to prevent asset devaluation or liquidity crises.

On cross-border capital flow regulation, the borderless circulation of stablecoins challenges the current country-based regulatory framework, necessitating enhanced international cooperation and information sharing. Concerning financial system interconnectedness, as stablecoin scale expands, its linkage with banks, payment systems, and capital markets may become risk transmission channels, requiring isolation mechanisms and macroprudential assessment frameworks.

Hong Kong is designing systems to balance financial innovation with financial stability, ensuring digital financial development remains within safety boundaries. Compared to international frameworks like the EU’s MiCA, Hong Kong’s approach with quantitative capital requirements and clear custody rules further refines operational standards, emphasizing its strategic positioning to build a high-transparency, high-trust digital financial ecosystem.