Chinese Tech Firms Partner Hong Kong Banks for Stablecoin Expansion

Chinese tech firms are moving to establish a presence in the stablecoin market through partnerships with Hong Kong-based digital banks, leveraging the city’s evolving regulatory landscape. This initiative, supported by the Hong Kong Monetary Authority (HKMA), aims to create a structured framework for stablecoin issuance and use in cross-border payments and tokenized asset trading [3]. The collaboration reflects a growing institutional interest in digital finance and signals a strategic shift in how Chinese companies are integrating blockchain technology into global financial systems [4].

Under the new stablecoin licensing regime introduced by the HKMA, several Chinese tech companies have begun working with local digital banks to apply for stablecoin licenses. This move is aligned with broader efforts to enhance the international use of the yuan, as Beijing explores the potential of yuan-backed stablecoins to expand the global reach of its currency [3]. The People’s Bank of China is expected to play a central role in the implementation process, suggesting a more structured and cautious approach to managing the associated risks and opportunities.

The regulatory changes in Hong Kong have created an environment conducive to experimentation and innovation, positioning the city as a key player in the regional stablecoin landscape. Hong Kong’s approach is viewed as more flexible compared to the mainland, making it an attractive hub for firms aiming to test new financial models. The HKMA’s oversight ensures that the development of stablecoins follows a structured and controlled path, while still allowing for the necessary flexibility to adapt to emerging opportunities [3].

The push for yuan-based stablecoins is also a strategic response to the growing influence of U.S.-backed stablecoins in global transactions. As the U.S. promotes dollar-backed stablecoins to reinforce the dollar’s dominance, China is seeking to develop its own alternatives through the Belt and Road Initiative (BRI). This would enable smoother cross-border transactions and reduce dependency on the U.S. dollar in international trade [4].

Domestically, major technology firms such as JD.com and Alibaba’s Ant Group have been urging the government to relax restrictions on stablecoin adoption, emphasizing the potential for reducing transaction costs and increasing financial efficiency. Meanwhile, private blockchain firms are also showing interest in the space, with some reportedly preparing to launch offshore yuan stablecoins, though details remain limited [4]. The industry appears cautiously optimistic about the potential of stablecoins to serve as a bridge between China’s digital infrastructure and global markets.

Industry leaders have expressed strong support for the development of stablecoins as tools for economic advancement. Zeng Yuchao, Managing Director at Futu Group, stated that stablecoins could be used as platform balances or for holding assets to facilitate stock purchases and streamline fiat currency clearing processes [3]. Christopher Hui, the Secretary for Financial Services, emphasized that stablecoins are not speculative tools but are powerful instruments for financial development. Hong Kong’s Financial Secretary, Paul Chan, also highlighted the importance of stablecoins in serving the real economy [3].

The Hong Kong digital asset market is showing signs of rapid growth, with over HK$26.1 billion in transactions recorded in the first half of 2025, a 233% increase compared to previous periods [3]. This surge reflects significant institutional engagement and suggests that stablecoins could become a vital component of the region’s financial infrastructure. Coincu research further notes that the newly established stablecoin licensing regime is expected to enhance global financial connectivity, with Hong Kong’s strategic geographic and economic positioning making it an attractive hub for international interest [3].

Source:

[1] title1.............................(https://coingeek.com/china-eyes-stablecoins-to-boost-yuan-internationalization/)

[2] title2.............................(https://www.mitrade.com/insights/news/live-news/article-3-1068557-20250826)

[3] title3.............................(https://coincu.com/news/chinese-tech-stablecoins-hong-kong/)

[4] title4.............................(https://www.aol.com/news/exclusive-china-considering-yuan-backed-115355828.html)

[5] title5.............................(https://www.khaleejtimes.com/business/cryptocurrency/asias-wealthy-investors-seek-more-crypto-in-portfolios)