HSBC & ICBC Seek Hong Kong Stablecoin Licences Under HKMA
HSBC and ICBC have applied for Hong Kong stablecoin licences under the HKMA’s new Stablecoin Ordinance, effective August 1. The ordinance criminalises unlicensed fiat-backed tokens for retail investors and triggered a 20% slump in local token values on day one. The SFC simultaneously enforced tighter crypto custody rules, banning smart contracts in cold wallets and warning against speculation. By late August, 77 institutions – including Standard Chartered – had expressed interest, though only a handful of licences will be granted initially. Traders should track Hong Kong stablecoin licence approvals and evolving custody guidance, as regulatory clarity will affect token liquidity and market confidence.
Neutral
In the short term, the new Stablecoin Ordinance and strict custody rules triggered a sharp 20% price drop in local tokens as unlicensed issuers exited the market. However, clearer licensing criteria and limited approvals by the HKMA should bolster long-term confidence and liquidity for approved Hong Kong stablecoins. Overall, the balanced effect of initial sell-offs and future regulatory certainty points to a neutral price impact.