Hong Kong Prepares First Stablecoin Licences for Major Banks

• Hong Kong plans first stablecoin licenses, with HSBC and Standard Chartered expected as initial issuers.
• HKMA reviewing dozens of applications but plans to approve only a limited number of stablecoin issuers.
• Stablecoin licensing aligns with Hong Kong’s wider push into tokenization and digital asset infrastructure.

Hong Kong authorities are preparing to grant the city’s first licenses allowing institutions to issue fiat-backed stablecoins, marking a key move in the government’s broader effort to formalize oversight of digital asset activity.

According to a Bloomberg report, the initial approvals are expected to go to established financial institutions, with HSBC and a consortium led by Standard Chartered positioned as leading candidates.

Regulators Limit Initial Stablecoin Approvals

The Hong Kong Monetary Authority (HKMA) plans to issue only a limited number of licenses after reviewing dozens of applications from companies seeking authorization to issue stablecoins. Officials are expected to prioritize institutions with established compliance frameworks and operational infrastructure.

The reported approach corresponds to a strategy often used when introducing new financial regulations, where regulators initially grant access to long-standing banks that dominate domestic financial services.

Standard Chartered is widely expected to receive one of the first approvals. The bank has been involved in Hong Kong’s regulatory sandbox for stablecoins since 2024, participating in tests exploring how blockchain-based currencies could support cross-border payments and settlements.

Through a partnership with Animoca Brands and Hong Kong Telecommunications, Standard Chartered has been working on plans to launch a digital currency pegged to the Hong Kong dollar.

HSBC has also emerged as a likely candidate for licensing, despite not participating in the earlier sandbox initiative. The bank previously focused on tokenized deposit projects rather than stablecoin experiments conducted under the HKMA’s testing framework.

Related: SFC Warns on ‘Hong Kong Stablecoin Exchange’ Name as City Tightens Platform Policing

Stablecoin Licensing Forms Part of Broader Digital Asset Plan

Hong Kong officials have previously confirmed that the city intends to issue its first stablecoin licenses in March as part of a wider plan to strengthen its digital asset regulatory environment.

Financial Secretary Paul Chan announced the initiative during the government’s 2026–27 budget speech, stating that the licensing system will allow approved entities to issue fiat-backed stablecoins under formal regulatory oversight.

Regulators plan to work closely with licensed companies to maintain compliance standards, manage operational risks, and safeguard financial stability once the framework becomes active.

Stablecoins are commonly used in digital asset markets for trading, payments, and cross-border transfers. Following this, authorities have indicated that clearer regulatory rules could improve transparency and investor confidence within the sector.

Hong Kong Expands Tokenization and Digital Asset Infrastructure

Alongside stablecoin regulation, Hong Kong has continued to expand projects focused on blockchain-based financial infrastructure.

The HKMA has launched the pilot phase of Project Ensemble, an initiative designed to explore tokenized deposits and digital asset transactions within regulated financial systems.

In parallel, CMU Omniclear, a subsidiary of the HKMA, is developing a digital asset platform intended to support the issuance and settlement of tokenized bonds.

Related: Hong Kong Set to Issue First Stablecoin Licenses in March