Hong Kong Imposes Strict Stablecoin Rules to Boost Digital Asset Hub

Hong Kong is rolling out one of the most comprehensive and rigorous regulatory frameworks for stablecoins globally, aiming to position the city as a leading digital asset hub. The Stablecoin Ordinance, enacted in May 2025, sets stringent requirements for capital, reserves, governance, and technology infrastructure for stablecoin issuers, with full implementation set to begin on August 1, 2025 [1]. Under these rules, stablecoin firms must meet a minimum capital requirement of 25 million Hong Kong dollars or its equivalent in another freely convertible currency to obtain a license [2]. The Hong Kong Monetary Authority (HKMA) has indicated that it will maintain a “high bar” for licensing, with only a few approvals expected initially [3].

The regulatory move comes in response to global developments, including the pro-crypto policies of US President Donald Trump, who recently signed a stablecoin law to bolster the US dollar’s presence in the crypto space [4]. Hong Kong’s regulatory approach, however, is distinct in its focus on fostering innovation while ensuring robust oversight. The rules aim to mitigate risks such as anti-money laundering (AML) violations and to ensure that stablecoins remain fully backed by fiat reserves [5].

To date, around 50 businesses in Hong Kong have reportedly expressed interest in applying for stablecoin licenses [6]. These include firms backed by prominent figures such as Jack Ma and JD.com’s international unit, as well as RD InnoTech Ltd, a company supported by former HKMA chief Norman Chan [7]. RD InnoTech plans to launch a stablecoin pegged to the Hong Kong dollar, targeting cross-border business-to-business payments [8]. The company also sees the new regulations as a stepping stone toward tokenizing offshore Renminbi [9].

The licensing process includes a six-month transitional period for existing stablecoin issuers to comply with the new regime. Applicants must submit formal applications within three months of the law’s enforcement; failure to do so may result in shutdown within four months [10]. During this period, the HKMA will issue temporary licenses to companies with clear paths to full compliance [11].

One of the key instruments expected to emerge from this regulatory shift is the HKDR stablecoin, a regulated digital currency fully backed by the Hong Kong dollar. It is designed to facilitate transactions, remittances, and investment diversification while bridging traditional finance and the crypto market [12]. RD Technologies, a key player in the digital asset space, recently secured $40 million in a Series A2 funding round to accelerate its infrastructure development [13]. The company is also partnering with ZA Bank, Hong Kong’s first virtual bank, to integrate HKDR into the broader financial ecosystem [14].

The broader digital asset regulatory strategy in Hong Kong aligns with the government’s “LEAP” initiative, which seeks to enhance the legal and regulatory environment for tokenized securities and decentralized finance (DeFi) [15]. By introducing a clear and structured licensing regime, Hong Kong is not only addressing compliance concerns but also attracting global investors and fintech firms to its market [16].

Source:

[1] title1 (https://www.weforum.org/stories/2025/07/stablecoin-regulation-genius-act/)

[2] title2 (https://www.mexc.com/news/interpretation-of-hong-kong-stablecoin-application-guidelines-the-first-batch-of-licenses-are-expected-to-be-issued-early-next-year/62913)

[3] title3 (https://www.coinex.com/en/insight/report/stablecoin-regulation-market-2025-6888a15ee1d07c946ffbd921)

[4] title4 (https://cryptoadventure.com/hong-kong-releases-guidance-on-strict-rules-for-stablecoin-issuers)

[5] title5 (https://www.panewslab.com/en/articles/fcbne5qs)

[6] title6 (https://www.onesafe.io/blog/hong-kong-stablecoin-hkdr-innovation)

[7] title7 (https://www.jdsupra.com/legalnews/the-payments-newsletter-including-1351633/)

[8] title8 (https://financefeeds.com/rd-technologies-raises-40m-in-series-a2/)

[9] title9 (https://wublock.substack.com/p/offshore-rmb-stablecoin-on-the-horizon)

[10] title10 (https://www.lexology.com/library/detail.aspx?g=384b43bc-a372-4e1b-ba3c-0990fa33e084)