Hong Kong missed its own March timeline for licensing HKD stablecoins, and the Hong Kong Monetary Authority (HKMA) has yet to approve any issuers despite public signs that the launch would begin last month.
In February at Consensus Hong Kong, Finance Secretary Paul Chan Mo-po said licenses would start being issued in March as part of the city’s push to position itself as a regulated hub for stablecoins and tokenized finance. The lack of approvals so far pushes that timeline back to April and raises questions about how quickly the framework will move from policy to implementation.
“When granting our licenses, we ensure that licensees have novel use cases, a credible and sustainable business model and strong regulatory compliance capabilities,” he said at the CoinDesk conference in Hong Kong.
Hong Kong’s South China Morning Post reported in March that HSBC and a joint venture between Standard Chartered and Animoca were expected to be among the first recipients of stablecoin licenses.
HSBC and Standard Chartered are two of the city’s note-issuing banks, a status that ties them directly to the Hong Kong dollar issuance framework and underlines how closely the stablecoin regime is linked to the existing monetary infrastructure.
This system dates back to 1846, when private banks began issuing currency backed by silver deposits in the absence of a colonial central bank.
Today, each banknote-issuing bank deposits US dollars into the government’s Exchange Fund at a fixed rate of HK$7.80 per dollar and receives Certificates of Indebtedness in return, against which it prints banknotes.
HKMA CEO Eddie Yue drew the parallel in a December 2023 blog post.
Pre-1935 banknotes issued by commercial banks in exchange for deposited silver were a form of “private money,” Yue wrote, and stablecoins function as their blockchain-based equivalent: tokens with stable value that can serve as a medium of on-chain exchange.
An HKMA spokesperson did not explain the reason for the delay.
“The HKMA is actively progressing the licensing matter and will announce further details in due course,” a spokesperson told CoinDesk.
