Hong Kong Approves Stablecoin Bill to Launch Licensing Regime by Year-End

Hong Kong has officially passed its stablecoin bill, paving the way for a new licensing framework for fiat-backed stablecoin issuers. The bill, approved during its third reading by the Legislative Council, marks a major step toward regulating the region’s growing digital asset ecosystem.

The legislation aims to create a clear regulatory path for stablecoins fully backed by fiat currencies, with licensing set to be administered by the Hong Kong Monetary Authority (HKMA) by the end of 2025. Lawmaker Johnny Ng emphasized Hong Kong's openness to global enterprises, stating on X (formerly Twitter), “We welcome international institutions interested in issuing fiat-backed stablecoins to apply in Hong Kong.”

Efforts to regulate stablecoins began in 2023, with the government releasing a consultation paper and building momentum toward this legislative milestone. The new stablecoin regime is expected to attract both crypto-native companies and traditional financial institutions looking to expand into the digital currency space.

Hong Kong joins a growing list of global jurisdictions establishing stablecoin regulations. The European Union implemented licensing for stablecoin issuers under its Markets in Crypto-Assets (MiCA) framework, while the U.S. continues to debate its own bill in Congress. The U.K. is also in the process of finalizing draft rules that could reshape its stablecoin landscape.

Stablecoins have become a critical focus for both the crypto and traditional finance sectors, with rising demand for digital dollars prompting major banks to explore issuance. Ben Reynolds, BitGo’s managing director of stablecoins, noted at Consensus 2025 that traditional banks are increasingly paying attention—fearing they could lose relevance in a digital-first economy.

With its new regulatory framework, Hong Kong positions itself as a competitive, compliant hub for stablecoin innovation in Asia.