Hong Kong gazettes new Stablecoin Ordinance, setting a regulatory framework for stablecoin issuance and oversight by HKMA.
- Ordinance establishes regulatory framework for stablecoins in Hong Kong.
- Hong Kong’s leadership continues to regulate crypto assets stringently.
- HKMA oversees implementation with industry consultations ongoing.
The Hong Kong government has gazetted the Stablecoins Ordinance, officially regulating the issuance of stablecoins, as stated by Chief Executive John KC Lee in May 2025.
This ordinance is significant as it introduces a new framework for stablecoin regulation, impacting the cryptocurrency landscape in Hong Kong and aligning with global trends.
Stablecoins Bill Passed in May 2025
The Hong Kong Legislative Council initially passed the Stablecoins Bill in May 2025, laying the groundwork for stablecoin regulation. The ordinance marks a first in Hong Kong for a structured regulatory approach.
Key players include the Hong Kong Monetary Authority, designated as the regulator. It has the responsibility for implementing the ordinance and engaging with the industry throughout the process.
Impact on Stablecoin Markets in Hong Kong
The ordinance affects any stablecoin with a value tied to fiat currencies like the Hong Kong Dollar. This means significant changes for market participants planning to issue such coins in the region.
Political and financial interests are at stake, with the ordinance ensuring a tighter regulatory environment. The HKMA’s involvement highlights a significant commitment to oversight and compliance.
Global Context: Lessons from TerraUSD Collapse
The regulation aligns with global efforts following the collapse of TerraUSD in 2022. It serves as a proactive step to prevent similar incidents in Hong Kong’s financial sector.
Expectations include a more stable and developed market in Hong Kong, with licensed operations and structured oversight potentially enhancing investor confidence.
John KC Lee, Chief Executive, Hong Kong Special Administrative Region, emphasized, “Enacted by the Legislative Council… An Ordinance to provide for the supervision of activities involving stablecoins; to provide the Monetary Authority with investigatory and enforcement powers; and to provide for incidental and related matters.”
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