Hong Kong’s monetary regulators mentioned they’ve concluded a session interval over a licensing program initiative for fiat-referenced stablecoin (FRS) suppliers.
The session, which resulted in February, obtained 108 submissions from varied stakeholders, together with market individuals, trade associations, {and professional} organizations.
The Financial Authority (HKMA) and the Monetary Providers and Treasury Bureau (FSTB) introduced this growth in a joint assertion on July 17.
Stablecoin licensing regime
The regulators acknowledged most respondents agreed {that a} regulatory regime for FRS issuers was crucial, contemplating the speedy rise of drastic digital property lately. They imagine this may handle potential financial and monetary stability dangers and guarantee clear and appropriate safeguards.
Moreover, most respondents additionally supported the proposed regulatory necessities and implementation preparations required by these stablecoin issuers. The regulators wrote:
“FRS, as in comparison with different varieties of stablecoins (e.g. commodity-linked or valuable metal-linked stablecoins), is taken into account as having larger potential to be developed as a generally acceptable technique of cost and therefore poses larger and extra imminent financial and monetary stability dangers.”
Christopher Hui, FSTB Secretary, famous that the licensing regime would bolster Hong Kong’s digital asset framework. He additionally emphasised that it aligns with worldwide requirements, promotes monetary stability, and mitigates losses.
The monetary regulators mentioned they’ll contemplate all of the suggestions in finalizing the legislative proposal for the regulatory regime and intention to introduce a invoice to the Legislative Council quickly.
This announcement follows the launch of Hong Kong’s stablecoin regulatory sandbox program in March. HKMA is processing purposes for the sandbox, and the record of individuals shall be introduced quickly.
In the meantime, these efforts replicate Hong Kong’s bid to turn into a hub for crypto innovation. Hong Kong stays one of many few areas targeted on regulating the crypto trade, making it a positive vacation spot for trade individuals.
