From August 1, 2025, new stablecoin regulations will apply in Hong Kong. This action comes after the ordinance was ratified on May 30 and a Gazette notice about it was published on Thursday. The rules set up a new process for licensing companies that issue stablecoins or provide related services.

Key-Takeaways:

• On August 1, 2025, Hong Kong will implement tough regulations and reserve standards for stablecoins, improving its position as a leading guardian of stablecoins.
• Only assets and not interest can be borrowed by stablecoins and only experts are allowed to invest in those that lack licenses.

Licensing Regulations and Section for Professional Investors

Hong Kong has now become a leading center for the regulation of crypto assets, thanks to the new stablecoin regulations. The new ordinance was described by Secretary Hui as a major achievement in the city’s digital asset goals.

These rules play a role in the wider plan to regulate cryptocurrencies properly. Hong Kong is now among the leaders in managing global stablecoin policies.

As a result of the new stablecoin  regulations, all issuers of stablecoins must acquire licenses from the Hong Kong Monetary Authority. This step is meant to keep the supervision of stablecoin operations.

It is anticipated that early this year, the regulatory body will issue the first licenses. It will make sure the environment is orderly and runs smoothly.

Anyone not licensed under the Securities and Futures Ordinance can only provide tokens to professional investors. This ensures retail investors are safe, as access is provided only to suitable participants.

New Stablecoin Regulations offer a transition period so that firms in the industry can get licenses and make the changes needed to follow the new guidelines. At this time, the government ensures that industries change while also keeping regulations in place.

The Minimum Requirements and Operating Standards

As per the new rules, stablecoin issuers are required to guarantee their coins with full reserves of reliable liquid assets. Such backing contains cash, deposits at a bank or securities from the government, all in the same currency as the stablecoin.

Any reserve funds have to be kept apart from the firm’s money and guarded in trust. This allows them to avoid claims from creditors and access their money exactly when they wish.

Under the new guidelines, stablecoin issuers are prohibited from offering interest, even though other non-interest rewards are allowed. All issuers are required to be incorporated locally and have their core staff stationed in Hong Kong.

They also have to reach a minimum capital requirement of HKD 25 million or 1% of their total issuance, whichever is the higher value. Redemption at par within the same business day guarantees that users have enough liquidity and stability.

Obligations for Compliance and Risk Management

The New Stablecoin Regulations cover comprehensive rules on complying with anti-money laundering and counter-terrorism financing. The Hong Kong Monetary Authority has revealed plans to create guidance outlining these requirements, so that issuers continue effective risk management practices.

The New Stablecoin Regulations require issuers to manage their reserve assets correctly, provide reliable ways to stabilize the value and accept redemption at par value while stating reasonable conditions. The regulations outline measures to verify that those leading stablecoins are qualified and trustworthy.

Hong Kong is among the top places to first apply full oversight to stablecoins. It could lead to changes in how the world handles regulation.

Prioritizing assets and openness creates a high quality among these organizations. More countries, like the U.S. with the Genius Act, could set up their own similar programs.

Licensed issuers are now the only ones allowed to advertise stablecoins which is meant to stop scams and secure consumers from fraud. Those interested in investing in stablecoins will receive clear directions from the government, making it clear how rules apply to them.

Conclusion

Hong Kong’s commitment to the stable and secure growth of digital assets is shown in its new stablecoin regulations. The new rules are applied starting August 1, 2025. They set up Hong Kong as a leading place for carrying out stablecoin transactions within the law. They have put in place strong regulations that serve as a guideline for the rest of the world.