
Gov’t greenlights Stablecoins Bill
The bill is expected to come into effect this year.
The government passed the Stablecoins Bill to establish a licensing regime for fiat-referenced stablecoins (FRS) issuers in Hong Kong.
Under the new ordinance, anyone doing business by issuing a stablecoin in Hong Kong, or offering one that is linked to the value of the Hong Kong dollar, even from outside Hong Kong, must get a licence from the Monetary Authority.
They must also comply with requirements in relation to anti-money laundering and counter-terrorist financing, risk management, disclosure and auditing, and fitness and propriety.
The government said that only specified licensed institutions may offer an FRS in Hong Kong, and only an FRS issued by a licensed issuer may be offered to a retail investor. In addition, to prevent fraud and scams, only advertisements of licensed FRS issuance are allowed.
The ordinance is expected to come into effect this year. A transitional arrangement will be implemented to facilitate the industry in applying for a licence and making suitable business arrangements in accordance with the regulatory regime.
“The ordinance adheres to the ‘same activity, same risks, same regulation’ principle, with a focus on a risk-based approach to promote a robust regulatory environment,” Christopher Hui, secretary for Financial Services and the Treasury, said.