Hong Kong Set to Issue First Stable‑coin Licences to Major Banks
Hong Kong – 14 March 2026 – The Hong Kong Monetary Authority (HKMA) is poised to award the inaugural stable‑coin issuer licences to two of the city’s most established note‑issuing banks – HSBC Holdings and a Standard Chartered‑led joint venture. Sources familiar with the process told the South China Morning Post that the regulator is preparing to formalise the approvals as early as late March.
Regulatory backdrop
Hong Kong’s stable‑coin framework was codified in the Stablecoin Ordinance, which came into effect in August 2025. The legislation makes it unlawful to market or sell unlicensed fiat‑backed stable‑coins to retail investors and obliges any issuer to obtain a licence from the HKMA. Since its launch, the HKMA has received applications from 36 entities, ranging from domestic banks to mainland lenders such as the Industrial and Commercial Bank of China (ICBC).
In February, HKMA Chief Executive Eddie Yue indicated that the first batch of licences would be deliberately small, reflecting a cautious rollout. The authority has not yet publicly confirmed the applicants that will be granted the licences.
Why HSBC and Standard Chartered?
Both HSBC and Standard Chartered already hold authorisation to issue Hong Kong dollar banknotes – a privilege accorded to only three commercial banks (the third being the Bank of China). By selecting institutions that already underpin the city’s sovereign currency, regulators aim to “bridge the trust gap” that typically surrounds native crypto issuers. According to a spokesperson for the consultancy Icon.Partners, leveraging these legacy banks “bypasses the trust gap of native crypto issuers by using institutions that already underpin the Hong Kong dollar.”
Timeline and next steps
While the exact schedule remains fluid, insiders suggest a decision could be announced around 24 March. If the licences are granted, the banks would be allowed to issue stable‑coins that are fully backed by Hong Kong dollars, subject to the stringent AML/CFT and capital‑preservation requirements set out in the Ordinance.
Strategic implications
- Positioning Hong Kong as a digital‑asset hub – The move reinforces the city’s ambition to become a global centre for regulated crypto activity, differentiating it from mainland China, where recent policy shifts have made stable‑coin issuance more difficult.
- Regulatory certainty – By aligning stable‑coin issuance with existing note‑issuing banks, the HKMA provides a clear, institution‑centric pathway for other financial players seeking entry into the market.
- Market impact – Early adoption by HSBC and Standard Chartered may encourage further institutional participation, potentially expanding the pool of eligible stable‑coin users and boosting liquidity for Hong Kong‑dollar‑denominated digital assets.
- Risk management – The limited‑scope rollout allows the regulator to monitor systemic risks, enforce compliance, and fine‑tune the licensing regime before scaling up.
Key takeaways
- First licences expected in March 2026, likely awarded to HSBC and a Standard Chartered joint venture.
- Selection rationale: banks already authorised to issue Hong Kong dollars, providing an established trust anchor.
- Regulatory framework: Stablecoin Ordinance (effective Aug 2025) mandates licences for fiat‑backed tokens; 36 applications have been received to date.
- Strategic goal: cement Hong Kong’s status as a regulated digital‑asset hub amid tightening mainland restrictions.
- Future outlook: A cautious, institution‑focused approach could pave the way for broader market participation once the initial pilot proves successful.
The impending approvals mark a significant milestone for Hong Kong’s digital‑currency ecosystem, signalling both regulatory confidence and an appetite for integrating stable‑coins into the city’s traditional financial infrastructure. As the HKMA finalises the licences, market participants will be watching closely for how the new issuers structure their token offerings and comply with the jurisdiction’s rigorous supervisory
Source: https://cointelegraph.com/news/hsbc-standard-chartered-hong-kong-stablecoin-report?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
