Today Hong Kong’s Legislative Council passed the Stablecoin Bill for fiat-referenced stablecoins. The legislation is expected to come into force later this year and is seen as a key pillar in Hong Kong’s desire to maintain and enhance its position as an international financial center. Last year the Hong Kong Monetary Authority (HKMA) launched a stablecoin sandbox which currently hosts three initiatives.
“The Ordinance has established a risk-based, pragmatic, and flexible regulatory regime,” said Mr Eddie Yue, CEO of HKMA. “We believe that a robust and fit-for-purpose regulatory environment would provide favourable conditions to support the healthy, responsible, and sustainable development of Hong Kong’s stablecoin and the broader digital asset ecosystem.”
One of the groups in the sandbox, Standard Chartered Bank Hong Kong, Hong Kong Telecom (HKT) and web3 firm Animoca Brands have created a joint venture to launch a stablecoin. Another sandbox member is JINGDONG Coinlink Technology a subsidiary of China’s e-commerce giant JD.com. The third member is RD Innotech a startup whose backers include Zhong An Digital Asset Group (affiliated with digital bank ZA Bank) and regulated crypto exchange HashKey. Today ZA Bank welcomed the passage of the Bill and is positioning itself as providing reserve banking services. Standard Chartered already provides similar services to stablecoin issuers Paxos and StraitsX in Singapore.
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