Hong Kong stablecoin license upcoming: a key step from "prudent and proactive" to a complete ecosystem

Hong Kong Financial Secretary Paul Chan Mo-po announced at the World Economic Forum that Hong Kong is expected to issue a stablecoin license later in 2026. This not only marks another improvement in Hong Kong’s virtual asset regulatory framework but also reflects the systematic strategic layout of this international financial center in the digital asset sector. Considering recent initiatives by Chan Mo-po, such as the Gold Central Clearing System and the Port Community System, Hong Kong is building a three-dimensional ecosystem that covers traditional finance, modern technology, and digital assets.

The Progress of Hong Kong’s Virtual Asset Regulation

Hong Kong’s regulation of virtual assets adopts a clear, progressive strategy. Since 2023, Hong Kong has issued licenses to 11 virtual asset trading platforms, establishing a regulatory foundation for trading venues. The promotion of the stablecoin license is a natural extension of this foundation.

From Trading Platforms to Stablecoins: A Logical Progression

Hong Kong’s approach follows the principle of “same activity, same risk, same regulation.” This means that virtual assets regulated in Hong Kong are treated similarly to traditional financial products, rather than being regulated separately. As the closest category of virtual assets to traditional payment tools, stablecoins’ licensing is an inevitable reflection of this regulatory philosophy.

Unlike other cryptocurrencies with high volatility, stablecoins are anchored to specific assets, making them more akin to payment tools. From a regulatory perspective, the risk profile of such assets is relatively manageable, but due to their payment functionality, issuers are subject to higher requirements for capital adequacy and risk management.

A Complete Digital Asset Regulatory Framework

According to official information, Hong Kong’s virtual asset regulatory framework includes the following core elements:

• Virtual Asset Trading Platform Licensing System (implemented, 11 licensed)
• Stablecoin Licensing System (upcoming)
• Regulatory Sandbox (launched, encourages innovative applications)
• Tokenized Bond Issuance Mechanism (implemented, $2.1 billion issued)

This framework features clear entry standards while leaving room for innovation.

Position in the Broader Strategic Context

The issuance of the stablecoin license is not an isolated policy move but an integral part of Hong Kong’s digital asset strategy.

Multi-Dimensional Fintech Layout

Recent initiatives by Chan Mo-po outline Hong Kong’s comprehensive vision:

Modernization of Traditional Finance: The Gold Central Clearing System aims for trial operation within 2026, strengthening Hong Kong’s position as a gold trading hub. As of November 2025, the daily trading volume of the Hong Kong Gold Exchange’s 99 Gold has reached HKD 2.9 billion, more than doubling year-over-year.

Trade Digitization: The Port Community System has been officially launched, involving over 2,300 companies. This system utilizes blockchain and AI technologies to provide real-time cargo tracking and innovative trade financing support.

Digital Asset Regulation: The stablecoin license is a key addition to the virtual asset regulatory framework.

These three directions collectively aim to further solidify Hong Kong’s role as a hub in the digital economy, building on its traditional financial center foundation.

Significance in the International Financial Landscape

Stablecoins have significant potential in cross-border payments, trade financing, and other areas. Hong Kong’s issuance of a stablecoin license means the city officially provides a compliant platform for stablecoin issuance and operation. This is crucial for attracting global stablecoin projects and related financial service providers.

On a broader scale, major global financial centers are vying for influence in the digital asset domain. Hong Kong’s “proactive yet cautious” strategy differs from some regions’ full openness or strict restrictions, seeking a balance—leveraging technological opportunities while managing risks.

Market Impact

Attractiveness to the Stablecoin Ecosystem

The stablecoin license will provide a regulatory foundation for Hong Kong to attract stablecoin projects. Several well-known global stablecoin initiatives are exploring Asian markets, and Hong Kong’s formal licensing system will offer these projects a clear compliance pathway.

Enhancement of the Virtual Asset Ecosystem

From trading platforms to stablecoins, Hong Kong’s virtual asset ecosystem is forming a closed loop. Trading platforms provide venues for virtual asset trading, stablecoins facilitate payments and settlements, and the regulatory sandbox encourages innovative applications. This ecosystem design is conducive to attracting more industry players and innovative projects.

Impact on Regional Competition

Singapore, Dubai, and other regions are also actively developing their digital asset regulations. Hong Kong’s move demonstrates its unwillingness to fall behind. The introduction of the stablecoin license system will enhance Hong Kong’s competitiveness in the integrity and clarity of virtual asset regulation.

Key Points to Watch Moving Forward

The specific rules for the stablecoin license system have not yet been announced. Future focus areas include:

• Specific application conditions and approval processes for licenses
• Capital and risk management requirements for stablecoin issuers
• Coordination mechanisms with other regional regulatory regimes
• Timing of the first license issuance and approved institutions

Summary

The launch of Hong Kong’s stablecoin license is a key step in advancing its virtual asset regulatory framework from “existing” to “comprehensive.” This initiative reflects Hong Kong’s systematic thinking in the digital asset field—balancing financial security with technological innovation opportunities. Coupled with measures like the Gold Central Clearing System and the Port Community System, Hong Kong is shaping a three-dimensional ecosystem covering traditional finance, modern logistics, and digital assets. For global stablecoin projects and virtual asset practitioners, Hong Kong is becoming a more attractive and compliant operational hub.