Hong Kong’s financial watchdog will issue a first batch of “very few” stablecoin issuer licenses in March, according to Reuters.
Eddie Yue, chief executive of the Hong Kong Monetary Authority (HKMA), said he expects to issue the first batch of stablecoin issuer licenses in March while addressing a meeting of Hong Kong’s Legislative Council on Monday.
However, he said only a “very small number” would be approved initially.
Stablecoins, a subset of cryptocurrencies with prices pegged to fiat money like the US dollar, are seeing increasing adoption globally as the world’s largest jurisdictions put regulatory frameworks in place. Last year, stablecoins moved $35 trillion on blockchain rails.
Currently a $300 billion asset class, Citi expected stablecoins to become a $1.9 to $4 trillion market. Standard Chartered chief executive Bill Winters said Hong Kong’s push for tokenized money and stablecoins could lay the foundations for a new era of digital trade settlement.
Yue noted that the application review process is nearing completion.
The head of the HKMA highlighted that the criteria for evaluating stablecoin issuer licenses focused on issues such as risk management, anti-money laundering measures and the supporting assets for stablecoins.
He also said that licensed issuers must comply with local regulations for cross-border activities, adding that mutual recognition agreements with other jurisdictions could be explored in the future.
