Hong Kong’s stablecoin rule takes effect today

Hong Kong’s Stablecoins Ordinance took effect Aug. 1, introducing a licensing regime to strengthen oversight of Hong Kong dollar–backed stablecoins, JinSe Finance reported, citing CCTV. Any entity issuing fiat-referenced stablecoins as part of a business in Hong Kong—or outside the special administrative region if the stablecoin is pegged to the Hong Kong dollar—must now be licensed by the Hong Kong Monetary Authority (HKMA). Licensed entities must meet standards for reserve management, redemption and asset segregation. They must also comply with anti–money laundering, risk and disclosure requirements. The HKMA will conduct further consultations on detailed supervisory guidelines.