Author: Shao Jiayi
On May 21, the second the Hong Kong Legislative Council passed the coin offering bill in the third reading, the comments in the crypto trading group next door went completely crazy:
"The licensing era has officially begun, and small players have no chance to play!"
“Issuing stablecoins now? If you are not brave enough, don’t do it!”
“PayFi is the real gold mine. If we don’t act now, all the soup will be gone!”
There was a mixture of noise, anxiety, and excitement. But the real Web3 veterans were unusually calm at this moment. They knew that the passage of the ordinance was not the end, but the moment when the new rules of the game started. When those giant stablecoin issuers began to line up to apply for the "Hong Kong ID card", a deep and quiet wealth restructuring drama around the stablecoin ecosystem had just begun.
Entrepreneurs, don’t just watch the giants fight, open your eyes and look under their feet - countless new tracks are opening up there, waiting for you to grab a spot and make money!
Stablecoin "dealing game": hell mode is on, and the novice village is closed!
Let's be frank: If you are still thinking about "getting rich overnight by issuing a stablecoin in Hong Kong", I advise you to give up this idea as soon as possible. This track has been locked into a "copy exclusively for krypton gold players". What is the specific difficulty? Let me count for you:
1. Sandbox players: the "chosen ones" who have been ahead for two years
The regulatory sandbox of the Hong Kong Monetary Authority is like a "stablecoin preschool". As early as two years ago, a group of "top students" were recruited for training, such as JD's stablecoin project and Yuanbi's stablecoin project. These players have polished the system development, compliance process, and risk control system in the sandbox. Once the regulations are implemented, they will directly "graduate" with a license, which is equivalent to being two laps ahead of the newcomers. How can you, a small team that has just entered the market, compete with them? They have written tens of thousands of lines of code, and you are still studying how to pass the compliance review. The gap is even greater than that between the top scorer in the college entrance examination and the poor student.
(II) Devil’s Clauses: Specially Designed to Cure All Kinds of “Garage Startup” Fantasies
The "sufficient financial resources" written in the regulations are no joke. For example, if you want to issue a stablecoin in Hong Kong, the registered capital alone must be 25 million Hong Kong dollars, and you must have proof of sustained profitability - this one item can block 99% of grassroots entrepreneurs. Not to mention "setting up a local physical company", you have to rent an office in Hong Kong, hire a compliance team, and support technical personnel, and the cost alone is several million per year. This is not entrepreneurship, it's clearly a "money-burning competition"! Think about the days when USDT could start in a garage, which are long gone. Now it's a "financial aristocratic game". Don't touch it if you don't have a lot of money.
(III) Supervision is so detailed that it can lead to failure if one is not careful.
In the past, when issuing stablecoins, some "sexy operations" might be done secretly, such as holding up the reserve fund if it was insufficient, but this is no longer possible. The regulations require that the reserve assets must be 100% equal, and can only be used to buy highly liquid assets such as cash and short-term government bonds. Want to use stocks or real estate to make up for the number? No way! What's more terrible is that the custodian and the issuer must be strictly separated, and the audit must be real-time and transparent - to put it bluntly, every penny of your money must be put on the table for supervision to watch, and even the two decimal places cannot be wrong. If you don't have a professional financial team and technical system, problems will be found in minutes, and fines are light, and you may even have to face lawsuits.
(IV) Policy risks are more stimulating than cryptocurrency speculation, and ordinary people cannot afford it
Stablecoins involve monetary sovereignty. How can the Hong Kong government issue licenses casually? In the next few years, it will definitely be "pilot first, steady progress". Only a few companies may be approved each year, and the competition is as fierce as "thousands of troops crossing a single-plank bridge". Moreover, policies may change at any time. The business allowed today may be tightened tomorrow. You are a small team that has worked hard for a year, but in the end you didn't get a license, but you burned all your money. What's the point?
A wake-up call for entrepreneurs: Small and medium-sized enterprises and start-up teams can basically give up and stop fantasizing about becoming Hong Kong's stablecoin issuers. This track is a battleground for giants who have no shortage of money, people, and political and business connections. But! Don't be discouraged! The real gold that belongs to entrepreneurs is hidden in the ecological niche outside the "license wall" built by the giants!
Guide to mining niches: Five core tracks, there is always one suitable for you
Since the coin issuance route is not feasible, let's change our thinking: be a "shovel seller" for coin issuers and a "road builder" for those who use stablecoins. The Hong Kong regulations actually draw a very clear boundary: coin issuance requires a license, but the service scenarios surrounding stablecoins are all open. I have sorted out five major compliance opportunities for everyone, and there is always one that can suit your appetite.
(I) Core Track 1: PayFi Infrastructure - Earning Money from “Stablecoin Circulation”
This is definitely the "main battlefield" for small and medium-sized teams. Why? Because the regulations clearly state that "development of stable currency payment and clearing systems is encouraged", and the market demand is so huge. To put it bluntly, the giants are responsible for issuing coins, and we are responsible for making the coins "flow", just like WeChat Pay and Alipay do not issue currency, but make a lot of money by relying on payment interfaces. How to play it specifically?
1. Cross-border payment: Let foreign trade bosses say goodbye to the pain of "waiting for money for three days"
How bad is the traditional SWIFT transfer? A cross-border remittance takes 3 days to arrive, and the handling fee is ridiculously high, especially for small and medium-sized foreign trade companies. The exchange rate loss alone is enough to make a big difference. But using stablecoins is different: USDC transfers arrive in 3 seconds, and the handling fee is less than 10% of the traditional method.
For example, suppose there is a boss who does cross-border e-commerce and has a monthly turnover of several million US dollars. If he uses traditional methods to transfer money, he will spend more than 20,000 yuan in handling fees each month, and he is often urged by suppliers because of the slow arrival of funds. If he is given a stable currency payment channel, the handling fee can be saved by 80%, and the funds will be received in real time. How can he not be happy?
2. Merchant settlement: From milk tea shops to chain brands, all require “instant payment”
Many merchants are already using USDT to collect payments, but they are all doing it covertly. After the regulations are implemented, a compliant stablecoin payment system will be a necessity.
For example, there are tea shops, tea restaurants, and chain retailers all over the streets. Don’t they want to collect money faster and at a lower cost? If you develop a payment platform/tool that allows them to settle stablecoins such as USDC and FDUSD in real time, with a handling fee 80% lower than that of traditional POS machines or payment gateways, and funds are deposited in seconds, how can the bosses not love you?
3. Multi-chain clearing: Become the "UnionPay of the cryptocurrency circle" and make money from traffic without doing anything
One of the biggest pain points in the cryptocurrency world right now is that “chains are not connected”: USDC on ETH, USDT on Solana, DAI on Polygon... What if merchants want to collect HKD? What if users want to make cross-chain payments? At this time, a “multi-chain clearing hub” is needed, just like the UnionPay system between banks, to connect the liquidity of stablecoins on different public chains and make stablecoins truly flow. The value is self-evident.
(II) Core Track 2: Compliant “Arms Dealers”, “Selling Tools” to Licensed Bosses
The stricter the supervision, the greater the demand for compliance services. Just like when e-commerce platforms emerged, a large number of agency operations and quality inspection service companies were born, the compliance needs of stablecoins will also give birth to a trillion-level market. What are the specific opportunities?
1. Anti-money laundering tools: making on-chain transactions “transparent”
Regulatory requirements require that stablecoin issuers must monitor transactions in real time, and report any suspicious addresses (such as those associated with exchange hackers) immediately. At this time, an "on-chain blacklist and whitelist screening tool" is needed. For example, you develop an API to connect to the data of major public chains to help issuers automatically identify risky addresses. For example: if 100,000 USDC is suddenly transferred to a certain address and then dispersed to 100 new addresses, your system can automatically trigger an early warning, indicating that it may be money laundering. This tool is charged annually, with one customer receiving 100,000 to 200,000 per year, and 10 customers can support a small team.
2. Audit service: "physical examination" of stablecoins
In the past, USDC issued a monthly reserve report, which was well received by the market because users needed to know whether their money was really protected. Now Hong Kong regulations require issuers to disclose reserve information regularly, which requires a professional audit team. You can set up a "stablecoin audit firm" to help issuers do real-time reserve verification, such as checking whether their bank account balance matches the number of stablecoins in circulation, and issue transparent reports. This service is expensive and requires professional qualifications. Once you get a few big customers, you can establish industry barriers.
3. RegTech: Making compliance “automatic”
Many small and medium-sized issuers do not have the ability or need to develop their own compliance systems. At this time, you can make a "compliance report generator", such as accessing their financial data and on-chain transaction data, automatically generating reports that meet the requirements of the HKMA, and submitting them with one click. Just like the current financial and tax software, simplifying the complex compliance process into "one-click operation", such tools can charge hundreds to thousands of Hong Kong dollars per month, and can make a lot of money if the number of customers is large.
(III) Core Track 3: Cross-chain Bridging - Being the "Ferryman of the Stablecoin World"
Multichain is the general trend. What comes with it is the explosive growth of cross-chain stablecoin demand. Especially in:
Enterprise payment scenario: The stable currency on the payer's chain is inconsistent with the chain/fiat currency required by the payee?
DeFi liquidation and arbitrage: The interest rate spreads and liquidity differences of stablecoins on different chains are opportunities, but how to move them over at low cost and high efficiency?
When USDC lies safely on Ethereum, USDT is having fun on Tron, and the tea restaurant owners in Hong Kong only recognize HKD... a safe, fast, and low-slippage stablecoin cross-chain bridge has become a necessity among necessities!
Opportunities: Develop secure, efficient, low-slippage cross-chain protocols or services focused on stablecoins. Focus on supporting mainstream public chains in the Hong Kong market: ETH, Solana, TON, Polygon, etc.
Technology lifeline: safety! safety! and safety! The tragedy of hundreds of millions of dollars being stolen from the Nomad Bridge is still fresh in our memory. Your bridge must be fully armed: consider introducing advanced cryptographic technologies such as zero-knowledge proof (ZK) for security verification, and multiple signatures, decentralized oracle networks, etc. None of them can be missing. Safety is 1, and everything else is 0.
Don’t cross the legal red line: When designing the mechanism, you must be careful to avoid being identified by regulators as a disguised form of currency issuance (such as issuing assets out of thin air through a bridge) or causing multi-chain inflation problems. This requires close collaboration between the legal and technical teams.
(IV) Core Track 4: Stablecoin Asset Management - Let the "lying flat" stablecoin "give birth"
If the stablecoins in the hands of users are just left there, they will have no returns like cash, but the Hong Kong Stablecoin Ordinance does not allow the issuer to directly pay interest. What should I do? At this time, asset management services are needed to help users make stablecoins "money make money":
1. Access DeFi protocol: earn interest rate difference between lending and borrowing
You can build a platform to connect the user's stablecoin to lending protocols such as Compound and Aave. After deducting your service fee from the interest earned by the user, the rest belongs to the user. For example, the current USDC lending rate of Compound is 4%. You charge a 1% service fee, and the user makes a net profit of 3%, which is much higher than the bank's current deposit. But remember: it is strictly forbidden to promise to protect the principal! The risk must be indicated in a prominent position on the page, such as a large title: "DeFi has risks, investment should be cautious", otherwise once the market plummets, users may sue you if they lose money.
2. Real asset (RWA) returns: investing in government bonds and real estate
In addition to DeFi, you can also invest stablecoins in real-world assets, such as U.S. Treasury token products. Users use USDC to purchase "Treasury bond tokens" and receive interest on time, and you charge management fees from them. This model is more compliant because Treasury bonds are low-risk assets with high regulatory acceptance. There are many asset management companies in Hong Kong that are good at RWA. You can cooperate with them to do front-end sales and compliance docking.
Teams such as Circle (through its asset management branch), Maple Finance (focused on institutional lending), and Ondo Finance (RWA pioneer) are already exploring this path. With its mature financial market and open regulatory attitude, Hong Kong is fully equipped to implement this model in a compliant and large-scale manner. It is suitable for teams that are proficient in financial engineering, familiar with structured products, and can play with compliance frameworks.
(V) Core Track 5: Reserve Asset Management - Being the "Steward of Stablecoins"
If a stablecoin issuer wants to obtain or renew a license, it must have top-level custody, management, and risk control arrangements for its reserve assets (cash, short-term government bonds, and possibly a small amount of highly rated RWAs). This means:
There is a surge in demand for professional asset custodians (which require corresponding licenses).
Audit agencies need to provide more fine-grained services.
Asset appraisal agencies need to provide real-time or high-frequency pricing.
It even requires a professional team to provide government bond allocation strategies and foreign exchange hedging solutions (which also requires a license or strong qualifications).
Core logic: Don’t build a giant ship (issue coins), but be the indispensable “ballast stone” and “escort ship” of the giant ship! Hong Kong has Asia’s top financial custody, clearing, and asset management ecosystem, which is the natural home advantage of local professional service institutions.
The table is open, which chair do you choose?
The implementation of the Hong Kong Stablecoin Ordinance is by no means the end of the story. It is more like a clear and powerful shot fired by Hong Kong in the global stablecoin regulatory competition. While New York lawmakers are still arguing and Singapore's framework is still being patched up, Hong Kong has already revealed clear, predictable rules that are in line with international standards - this in itself is a huge and scarce institutional dividend!
Stop staring at the top of the pyramid of "issuing coins" and look at the ecological niches around you: some people make tens of millions a year by making payment interfaces, some are valued at over 100 million by selling compliance tools, and some get top institutional investment by cross-chain bridges. The Hong Kong stablecoin game has already begun. The giants are the dealers issuing coins, and we ordinary people can be the ones who "sell tea and rent chairs next to the dealers" and still have a place in this new financial era.
Finally, I would like to leave you with a message: In the world of Web3, smart entrepreneurs never go head-to-head with giants, but dig their own gold mines in corners that they cannot see. In the new era of Web3 where licenses are king, compliance is no longer just a bottom line, but your sharpest and most indispensable ticket! Only by seeing the track clearly and finding the right ecological niche can you find real gold in this round of stablecoins led by Hong Kong.
