Hong Kong expects to issue first stablecoin license in March

Hong Kong authorities are moving forward with a stablecoin licensing system despite caution from the Chinese central government, CNBC reported. The Hong Kong Monetary Authority (HKMA) is reportedly reviewing 36 applications for stablecoin issuance. In May of last year, Hong Kong passed a stablecoin ordinance requiring licenses for any entity issuing stablecoins within the city or handling stablecoins pegged to the Hong Kong dollar. The law took effect in August, after which the HKMA began accepting applications. Mainland China, however, remains cautious. Chinese regulators, including the People's Bank of China, expressed concerns about Hong Kong's stablecoin plans in October of last year, effectively halting discussions. China has cited volatility, illicit fund transfers, and risks to monetary sovereignty as key concerns since banning all cryptocurrency trading in 2021. At a Legislative Council meeting on Feb. 2, HKMA Chief Executive Eddie Yue said a decision on the first stablecoin license approval could be made as early as March.