Quick Breakdown
- Over 77 firms have shown interest in Hong Kong’s stablecoin licenses, including ICBC, Standard Chartered, and PetroChina.
- Lawmakers stress that approvals will be scarce, with possibly only one license issued in the first round.
- Regulators are tightening controls following a rise in fraud complaints tied to stablecoins.
Major banks and firms join race as regulators warn of fraud risks
Hong Kong authorities are treading carefully with their stablecoin licensing regime, despite surging interest from global banks and corporations. The Hong Kong Monetary Authority (HKMA) confirmed that more than 77 firms have signaled intent to apply, but approvals will remain highly selective.
Major Players Line Up for Approval
The Hong Kong branch of the Industrial and Commercial Bank of China (ICBC) has officially joined the pool of applicants, following the Hong Kong Bank of China’s earlier move. Other heavyweight contenders include Standard Chartered and PetroChina, underscoring the sector’s growing appeal among leading financial institutions.
Legislators, however, cautioned that strong demand would not translate to broad approvals.
“The number of licenses to be issued will be very small,”
one Member of the Legislative Council reportedly said. Only a handful of firms are expected to qualify, with lawmakers suggesting that just one license may be issued in the initial batch next year. Earlier reports also hinted at a possible invite-only model to ensure tight regulatory oversight.
Fraud Concerns Shape Regulatory Stance
Authorities are taking a defensive stance after a rise in fraud linked to stablecoins since Hong Kong’s stablecoin law came into effect on August 1. The Securities and Futures Commission (SFC) and HKMA reported 265 complaints tied to digital asset crime in the first half of the year, with stablecoin transactions increasingly flagged.
Officials say the cautious licensing model is designed to protect Hong Kong’s financial stability and safeguard its reputation as a global financial hub.
Tight Deadlines for Applicants
The HKMA has set September 30 as the deadline for firms to submit their full applications. However, industry watchers believe approvals will not be granted before the end of the year. This timeline leaves applicants in limbo, as regulators deliberate over how to balance innovation with risk management.
If you would like to read more articles like this, visit DeFi Planet and follow us on Twitter, LinkedIn, Facebook, Instagram, and CoinMarketCap Community.
Take control of your crypto portfolio with MARKETS PRO, DeFi Planet’s suite of analytics tools.”
