Author: Tim Sun, Senior Researcher, HashKey Group

With the Hong Kong stablecoin licensing mechanism finalized, Hong Kong's Web3 industry is officially transitioning from the early "foundation-laying" stage to a new "skyscraper-building" phase. The stablecoin license not only completes a crucial piece of the regulatory puzzle but also signifies that Hong Kong's digital assets are beginning to "move from the virtual to the real"—gradually expanding from the trading and narrative of the digital asset market itself to real-world business and payment scenarios.

For a long time, discussions about stablecoins have largely focused on trading and expansion in the digital native market. However, as traditional finance accelerates its integration with digital assets, this discussion is giving way to a more specific and core question: how will this mechanism truly connect to real-world payment, settlement, and trade scenarios? According to information released by the Hong Kong Monetary Authority (HKMA), the first batch of licenses is mainly concentrated in banking institutions and large financial institutions—those with strong reserve management, anti-money laundering (AML) capabilities, and distribution capabilities. This result is not surprising. From the outset, the HKMA has sent a clear signal: the issuance of the first batch of licenses will be very restrained and limited, with the review focusing heavily on use cases, risk management, AML, and asset reserve arrangements. This clearly reflects the core orientation of Hong Kong regulation—not simply encouraging institutions to enter the market early to chase hype, but prioritizing ensuring that the first batch of licensees have sufficiently strong issuance and absorption capabilities, allowing stablecoins to operate within a controllable, auditable, and sustainable framework, thereby achieving the best balance between upholding risk limits and encouraging market innovation.

Following this regulatory approach, we need to move beyond the singular perspective of a "payment instrument" and re-examine the value of Hong Kong stablecoins. Their essence should be viewed as a "local currency interface" for the digital finance era. Their core role is far more than simply lowering the barrier to on-chain transfers; it's about enabling the Hong Kong dollar, historically within a compliant framework, to be programmable, capable of real-time settlement, and embedded as a core medium of exchange within on-chain assets and application scenarios, deeply integrating into the digital financial system. The HKMA's emphasis on feasible use cases, prudent and stable operation, and market trust essentially treats stablecoins as a core type of financial infrastructure for management. If Hong Kong hopes to maintain its leading position as an international financial center in the digital finance era, it needs more innovation and application scenarios at the stablecoin level. Currently, US dollar stablecoins have formed a vast global network effect, but they serve the US dollar system, corresponding to US regulation, US dollar liquidity, and the US dollar settlement network. For Hong Kong's digital financial ecosystem to develop, the Hong Kong dollar itself must possess a digital, on-chain, and transferable interface; this is the most important strategic significance of Hong Kong's stablecoin system.

Of course, in its initial stage, Hong Kong dollar stablecoins have chosen a realistic development path, focusing on the local market and pioneering a closed loop of Hong Kong dollar pricing, clearing, and settlement. This means that in the short term, the market is more likely to form a tacit division of labor: US dollar stablecoins will continue to dominate the global crypto capital market and cross-border US dollar flows; while Hong Kong dollar stablecoins will focus on serving the local Hong Kong financial system, regional payments, real-world asset (RWA) settlement, and various locally regulated financial scenarios.

With a clearer regulatory framework, the stablecoin ecosystem is poised for rapid growth. Currently, we are engaged in substantive discussions with licensed stablecoin issuers and welcome more institutions planning to issue compliant stablecoins in Hong Kong to establish deep partnerships. As a core participant in the Hong Kong digital asset market, HashKey will leverage its existing licensing and compliance system, fiat currency channels, and long-accumulated industry resources to provide compliant stablecoins with one-stop professional services, including trading platform listings, liquidity support, and payment scenario expansion. In the future, HashKey will continue to leverage its ecosystem advantages as a licensed exchange to fully support the listing of relevant trading pairs and deep market making, empowering the widespread adoption and implementation of compliant Hong Kong dollar stablecoins across various scenarios. HashKey will also continue to collaborate closely with industry partners to promote the practical use and large-scale implementation of compliant Hong Kong dollar stablecoins, focusing on key areas such as payment, settlement, and cross-border applications, thus fostering a more robust and sustainable development of the Hong Kong digital asset market.