Shaping the Future: Hong Kong's Stablecoin law is here

With the passing of the Stablecoins Bill in May 2025, Hong Kong is one major step closer to implementing its planned agile, regulatory regime that includes the regulation of fiat referenced stablecoins by the HKMA. The regime is expected to come into force later in 2025.

Key Takeaways:

1. The stablecoin legislation has been passed and is now final. The Hong Kong Monetary Authority (“HKMA”) will follow up by publishing consultations on the rules and guidelines necessary to have a full overview of all elements of the regime.
2. Only issuers of stablecoins that are fiat-referenced stablecoins, referred to as ‘specified stablecoins’ (see definition box in the bulletin) will be eligible for a licence under the new HKMA licensing regime.
3. Specified stablecoin issuers will need a licence to issue or actively market in Hong Kong, or if they issue stablecoins which reference the Hong Kong dollar even from outside Hong Kong.
4. Specified stablecoin issuers will need to be incorporated in Hong Kong and maintain certain key personnel in Hong Kong.
5. Retail investors can only purchase specified stablecoins issued by HKMA licensed specified stablecoin issuers.
6. Stablecoins which are not specified may potentially fall under other regulatory regimes in Hong Kong so they will need to be assessed with reference to these regimes before being made available for Hong Kong investors.
7. Key legal issues to consider in the new regime include analysis of stablecoin structures and whether they are a specified stablecoin or whether they fall within another regulatory regime, and assessing whether existing structures can continue operations during the transitional period.