On May 21, 2025, according to Greater Bay Area Voice, the Legislative Council of the Hong Kong Special Administrative Region officially passed the Stablecoin Bill (hereinafter referred to as “the Bill”). All that remains is the Chief Executive’s signature and publication in the Gazette for the law to take effect, marking the beginning of a new era of stablecoin regulation in Hong Kong. The HKSAR Government welcomed the move, calling it a key step toward improving the city’s virtual asset regulatory framework — ensuring both financial stability and innovation.
Legislative Council member Duncan Chiu stated that this marks a milestone for global Web3 development and a significant leap for Hong Kong’s ambition to become an international Web3 hub. Industry experts and market participants widely believe that the Bill’s passage will trigger a breakout period for stablecoins in Hong Kong, positioning the city as a global pioneer in stablecoin regulation and adoption.
Overview of the Hong Kong Stablecoin Bill
Key Timeline
Jan 12, 2022 — HKMA released a discussion paper on crypto assets and stablecoins
Oct 31, 2022 — Government issued a policy statement on virtual asset development
Jan 31, 2023 — HKMA published a summary of feedback from the discussion paper
June 2023 — Virtual Asset Trading Platform (VATP) licensing regime came into effect
Dec 2023 — Feb 2024 — Public consultation on regulating stablecoin issuers, with 108 responses received
Mar 12, 2024 — HKMA launched a regulatory sandbox for stablecoin issuers
Jul 17, 2024 — HKMA and Financial Services & the Treasury Bureau released a summary of public comments
Jul 18, 2024 — List of sandbox participants announced, including:JD Chain Technology (HK) Co., Ltd；Circle Innovations Technology Ltd；Standard Chartered Bank (HK)；Animoca Brands；Hong Kong Telecommunications.
Dec 3, 2024 — Chief Executive directed submission of the Stablecoin Bill to the Legislative Council
Dec 6, 2024 — Bill gazetted
Dec 18, 2024 — First reading in Legislative Council
Jan 3, 2025 — Reviewed by House Committee
Jan 21, 2025 — Reviewed by Bills Committee
May 21, 2025 — Bill passed in second and third readings
Next step — Awaiting Chief Executive’s signature and official publication for enforcement
Key Provisions of the Stablecoin Bill
Regulatory Authority
The Hong Kong Monetary Authority (HKMA) will serve as the regulator for all stablecoin-related activities.
- Scope of Regulation
Focuses on fiat-backed stablecoins, i.e., tokens pegged to one or more fiat currencies. Stablecoins pegged to commodities or other assets may also be brought under regulation via public notice.
- Regulated Activities
Issuing or promoting stablecoins in Hong Kong without an HKMA license is prohibited. Even offshore issuers targeting the Hong Kong Dollar (HKD) will fall under the jurisdiction.
- Licensing Requirements
Licensed issuers must meet strict standards:
Reserve management: Backed by 100% reserves matching face value
Redemption assurance: Users must be able to redeem at par value without unreasonable barriers
Local incorporation in Hong Kong
Financial strength: Minimum paid-up capital of HK$25 million
Qualified personnel, sound risk management, and AML compliance
- License Duration
Licenses are open-ended and remain valid unless revoked by the HKMA.
- Entities Allowed to Sell Stablecoins
Only the following may publicly sell fiat-backed stablecoins:
HKMA-licensed stablecoin issuers
SFC-licensed virtual asset trading platforms
Entities regulated under the Securities and Futures Ordinance
Authorized banking institutions
- Penalties
Unlicensed issuance or sale: HK$5 million fine and up to 7 years imprisonment
Fraudulent activity: Up to HK$10 million fine and 10 years imprisonment
- Regulatory Powers
The HKMA may:
Request documentation
Investigate violations
Issue directives and impose penalties
Suspend or revoke licenses for non-compliance
Broader Impact of Hong Kong’s Stablecoin Regulation
With the Stablecoin Bill officially passed, Hong Kong enters the era of compliant stablecoin regulation. This framework provides legal clarity for issuers and trading platforms, and boosts investor and user confidence in stablecoin transactions.
As one of the world’s leading financial hubs, Hong Kong — with its mature legal system and international financial infrastructure — is well-positioned to attract stablecoin projects and Web3 businesses, accelerating the development of a healthy digital asset ecosystem.
Most notably, Hong Kong has overtaken the United States by implementing a stablecoin law first — becoming the first jurisdiction in Asia to establish a clear legal regime for stablecoins. This move strengthens Hong Kong’s bid to be a global leader in digital asset regulation and innovation.
By the end of 2025, the first wave of compliant stablecoins is expected to launch in Hong Kong, potentially kicking off the next growth cycle in the digital asset space.
Conclusion
The passage of Hong Kong’s Stablecoin Bill marks a new chapter in global digital asset regulation. As a front-runner in financial innovation across the Asia-Pacific, Hong Kong is not only leading in compliance, but also laying the foundation for stablecoins and the broader crypto industry to grow in a regulated, secure environment.
Looking ahead, stablecoins and blockchain technology will further drive the digital transformation of financial services, and Hong Kong is poised to become a key hub in that global shift.
