Cat Brother Wu talks about blockchain

On May 21, 2024, the Hong Kong Legislative Council officially passed the Stablecoin Issuers Bill in its third reading, which provides the first complete regulatory framework for stablecoins.

On May 21, 2024, the Hong Kong Legislative Council officially passed the Stablecoin Issuers Bill in its third reading, which provides the first complete regulatory framework for stablecoins. After the implementation of the Ordinance, three types of stablecoin-related activities must obtain a license: first, issuing legal currency stablecoins in Hong Kong; second, issuing Hong Kong dollar stablecoins in or outside Hong Kong; third, actively promoting the issuance of its legal currency stablecoins to the Hong Kong public. The Ordinance is expected to take effect this year.

In terms of applying for a license, the Ordinance stipulates that any individual or entity wishing to issue or operate a “designated stablecoin” in Hong Kong must submit a formal application to the Hong Kong Monetary Authority (hereinafter referred to as HKMA). HKMA will review and determine whether the applicant meets the minimum standards listed in Schedule 2 (such as capital strength, risk management, corporate governance structure, internal control system, etc.). For example, in terms of qualification review, it is stipulated that the licensee must have sufficient financial resources and liquid assets, including a licensee with a share capital of at least HK$25 million.

The license does not have a fixed validity period and will remain valid unless it is revoked or the licensee is liquidated or has its registration with the Hong Kong Companies Registry revoked. However, if the licensee does not meet the minimum standards or has major problems, such as being unable to fulfill its repayment obligations, improper governance or major violations, the HKMA may revoke or suspend its license and, if necessary, send a statutory administrator to take over the business to protect the public interest. The HKMA will also set up a “registration list of licensees” where the public can check which entities are authorized and qualified to operate.

According to Caixin, citing a speech by Hong Kong Financial Services and the Treasury Bureau Director Paul Hui in the Legislative Council, the Bill stipulates that only designated licensed institutions are allowed to sell legal currency stablecoins in Hong Kong, and only legal currency stablecoins issued by licensed issuers can be sold to retail investors. The above-mentioned designated licensed institutions that can sell stablecoins in Hong Kong include: stablecoin issuers licensed by the Monetary Authority, banks, institutions issued by the Hong Kong Securities and Futures Commission with a Type 1 license (securities trading), and virtual asset trading platforms licensed in Hong Kong.

In addition, the draft also stipulates that engaging in regulated stablecoin activities without a license or selling designated stablecoins without authorization is a criminal offense, with a maximum fine of HK$5 million and imprisonment for 7 years. If it is a summary conviction, the penalty is a

A key focus of the Hong Kong Monetary Authority's (HKMA) sandbox initiative is to explore the use of tokenized RWA (real-world assets) to broaden the application of stablecoins. The initiative aims to foster an innovative ecosystem for digital assets while prioritizing stability and consumer protection.

Among the three groups of participants, Standard Chartered Hong Kong, Animoca Brands, and Hong Kong Telecom will collaborate to develop use cases for tokenized RWA, focusing on optimistically interoperable blockchain protocols and technologies.

The Hong Kong Monetary Authority (HKMA) is introducing a new regulatory framework for stablecoins, aiming to create a balanced ecosystem that encourages innovation while safeguarding the financial system.

The Stablecoin Issuers Bill, passed by the Hong Kong Legislative Council in May 2024, provides the legal basis for a licensing system and minimum standards for stablecoin issuers.

To apply for a license, any individual or entity wishing to issue or operate a "designated stablecoin" in Hong Kong must submit a formal application to the HKMA. The applicant must meet the minimum standards, which are specified in Schedule 2 of the Ordinance. These standards cover various aspects, including capital strength, risk management, corporate governance structure, internal control system, and minimum requirements for the stablecoin to be issued.

The license will remain valid unless it is revoked, the licensee is liquidated, or its registration with the Hong Kong Companies Registry is revoked. However, if the licensee does not meet the minimum standards or has major problems, such as being unable to fulfill its repayment obligations, improper governance, or major violations, the HKMA may revoke or suspend its license and, if necessary, send a statutory administrator to take over the business to protect the public interest.

The HKMA will also set up a "registration list of licensees" on its website, where the public can check which entities are authorized and qualified to operate.

The Bill also stipulates that only designated licensed institutions are allowed to sell legal currency stablecoins in Hong Kong, and only legal currency stablecoins issued by licensed issuers can be sold to retail investors.

The designated licensed institutions that can sell stablecoins in Hong Kong are:

- Stablecoin issuers licensed by the Monetary Authority

- Banks

- Institutions issued by the Hong Kong Securities and Futures Commission with