Hong Kong is weeks away from issuing its first-ever stablecoin license, a move that will cement the city's role in regulated digital finance. The Hong Kong Monetary Authority (HKMA) has wrapped up detailed vetting of applicants and is expected to approve the pioneer issuer by March 2026, according to sources familiar with the process.
36 Bidders, Only a Handful Will Win
HKMA Chief Executive Eddie Yue told the Legislative Council that the review is nearly complete, but only a small number of applicants will get the nod. The regulator is currently processing 36 applications — down from over 40 initial inquiries — filtering out those that fail to meet reserve, risk, or compliance thresholds. "We focus on use cases, reserve backing, risk management, and AML controls," Yue said, signaling that no applicant gets a free pass.
Tough Rules: Full Backing, Instant Redemption, No Interest
The licensing regime, launched in August 2025, mandates that issuers maintain 100% reserve backing in highly liquid assets and honor redemptions within one business day. Stablecoin holders cannot earn interest — a deliberate design to keep tokens as payment tools, not deposit substitutes. All fiat-backed stablecoins, including foreign tokens pegged to the Hong Kong dollar, fall under the license. Issuers must be locally incorporated or authorized, with independent directors overseeing compliance. They also need to conduct customer due diligence, use secure wallets, and adhere to anti-money laundering and counter-terrorism rules. HKMA retains sweeping powers to add conditions, install managers, or revoke licenses for noncompliance.
Heavyweights in the Sandbox
Several big names are already testing in HKMA's regulatory sandbox. Standard Chartered has teamed up with Animoca Brands and HKT to form Anchorpoint Financial. Ant Group's digital unit is also in the queue. Bank of China Hong Kong, HSBC, and ICBC have expressed interest. But HKMA cautions that sandbox participation does not equal endorsement — each firm must still pass the full licensing review.
Hong Kong's stablecoin framework is one of the most rigorous globally, balancing reserve safety, consumer protection, and anti-money laundering. The first license is expected to trigger a wave of compliant projects, putting Hong Kong in direct competition with Singapore and the EU for stablecoin business.