Hong Kong Passes Stablecoin Bill, Opening the Region to Establish a Licensing Regime for Fiat-Backed Stablecoin Issuers

"Hong Kong's stablecoins are backed by fiat currency as underlying assets, and we welcome global enterprises and institutions interested in issuing stablecoins to apply in Hong Kong"

Hong Kong has made significant strides in establishing a licensing regime for fiat-backed stablecoin issuers, paving the way for the region to become a hub for digital asset innovation.

The nation’s stablecoins are backed by fiat currency as underlying assets, and we welcome global enterprises and institutions interested in issuing stablecoins to apply in Hong Kong, legislative council member Johnny Ng said on X.

Institutions are expected to be able to apply for a license from the Hong Kong Monetary Authority by the year-end.

Hong Kong has been working on establishing a stablecoin regime since earlier this year. The nation had published a consultation paper on stablecoin guidelines towards the end of last year. It later introduced the Stablecoin Bill, which the Legislative Council of the Hong Kong Special Administrative Region passed in its third reading, Ng’s post said.

The Asian nation is looking to keep up with nations around the world that have been establishing their own stablecoin regimes.

The EU started licensing stablecoin issuers last year after passing its wide-ranging bespoke crypto bill, called the Markets in Crypto Assets regulation (MiCa).

Meanwhile, the U.S. has a stablecoin bill that is passing through Congress, and the U.K. has been gathering feedback on draft legislation that will also affect stablecoins.

The stablecoin sector has become one of the hottest trends in recent years, with both crypto and TradFi firms ramping up their exposure to the industry.

BitGo's managing director of stablecoins, Ben Reynolds, said at Consensus 2025 that large banks are increasingly becoming aware of the industry, largely out of fear that they will lose market share to the digital dollars.