- Quick Take
- Today, stablecoin legislation moved forward when Hong Kong lawmakers approved it in its final stage.
- Issuers of stablecoins are required by the Stablecoins Ordinance to first receive a license from the Hong Kong Monetary Authority.
Hong Kong, May 21, 2025 – Hong Kong has taken a big step to promote digital currency and Web3 technology. Today, the Legislative Council there passed the Stablecoins Bill. Through this law, now companies making stablecoins (which are linked to a real currency like the dollar) in Hong Kong will have to obtain a license. This rule will come into force by the end of the year.
Now if any company wants to make a stablecoin linked to the Hong Kong dollar – whether it is inside Hong Kong or outside – it will have to obtain a license from the Hong Kong Monetary Authority (HKMA). The purpose of this rule is to protect people’s money and keep the financial system strong.
Under the law:
- Stablecoins must be fully backed by real currency,
- Companies must manage their reserves properly,
- Customers must be paid back their money at full value,
- And customers’ money must be kept separate from company funds.
HKMA chief Eddie Yu said the law was a “balanced and pragmatic approach” to the safe development of digital finance. He said, “This licensing system will make Hong Kong a global hub in the field of Web3.”*
The bill is part of plans already underway. In 2023, Hong Kong introduced licensing for virtual asset exchanges and in 2024 created a stablecoin sandbox – a system where companies can safely test new technologies. The sandbox included big companies like Standard Chartered, Animoca Brands.
Now companies will be given time to adopt the new rule. Applications for licenses will begin in late 2025, and the full system will be implemented this year.
Legislator Johnny Ng, who is very active in Web3, said, “Hong Kong is ready for Web3. We welcome crypto and fintech companies from around the world.”
This law will identify Hong Kong among the cities in the world that are embracing crypto and digital finance with open arms – such as Singapore and Dubai. Experts believe that this will bring more stablecoin projects to Hong Kong and the city will play a big role in the digital economy.
Now the whole world is watching Hong Kong to see how it implements this new law. If all goes well, Hong Kong could be one of the most important countries to determine the future of stablecoins and Web3 technology.
For information related to the Stablecoins Bill and license, you can visit the HKMA website.
