Hong Kong's Secretary for Financial Services and the Treasury, Christopher Hui, has emphasized that stablecoins should be recognized as tools for financial development rather than instruments for speculation or quick profits. His comments came during a television interview discussing Hong Kong's updated Digital Assets Development Policy Declaration 2.0.
Key Highlights from the Policy Declaration
- Stablecoin Licensing Mechanism: Effective August 1, 2025, Hong Kong will implement a licensing framework for stablecoin issuers, aligning with international standards to ensure transparency and security.
- Blockchain Efficiency: Hui highlighted how blockchain technology can enhance cross-border transactions, particularly in developing economies where local currencies face volatility risks.
- Future Regulatory Focus: The government plans to regulate electronic asset trading and custodial services to maintain Hong Kong's competitive edge as a global financial hub.
Addressing Market Pain Points
"Stablecoins pegged to reliable fiat currencies and leveraging blockchain technology offer practical solutions to challenges like currency volatility and inefficient settlement systems," Hui explained. He cited Hong Kong's recent issuance of over HKD 70 billion in tokenized bonds, which reduced settlement cycles from five days to just one.
Hong Kong's Financial Market Outlook
- IPO Leadership: The city has hosted 40+ IPOs in 2025, raising approximately HKD 100 billion, ranking first globally in IPO volume.
- Commodities Expansion: The London Metal Exchange's inclusion of Hong Kong as a delivery location and upcoming gold storage facilities signal growing demand for diversified financial services.
FAQs
Q: What is the primary purpose of Hong Kong's stablecoin regulations?
A: To foster a sustainable digital asset ecosystem while preventing speculative risks associated with unregulated markets.
Q: How does blockchain benefit developing economies?
A: By enabling faster, more secure transactions in regions with unstable local currencies and underdeveloped financial infrastructure.
Q: What are Hong Kong's next steps in digital asset regulation?
A: Establishing frameworks for electronic asset trading and custody services to ensure market integrity.
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