Hong Kong to Launch Stablecoin Licensing Regime in 2026, Financial Chief Says

Hong Kong has licensed 11 virtual asset trading platforms since 2023 and expects to launch a licensing regime for stablecoins later this year, Financial Secretary Paul Chan announced Tuesday at the World Economic Forum in Davos.

Speaking at a breakfast meeting hosted by Animoca Brands, Chan said Hong Kong takes a "proactive yet prudent approach" to digital asset development, applying its principle of "same activity, same risk, same regulation" to promote responsible market growth, according to a government statement.

Chan discussed how blockchain applications, including tokenized assets and genomic data analytics, are driving transformation in capital markets. He emphasized that financial innovations such as digital assets enhance transparency, efficiency and risk management while facilitating capital allocation to the real economy.

The Hong Kong government has taken a leadership role in tokenization, issuing three batches of tokenized green bonds totaling approximately $2.1 billion. The city has also introduced regulatory sandboxes to encourage innovative applications in the market.

The stablecoin licensing framework expected later this year would add another layer to Hong Kong's digital asset regulatory structure, which already covers cryptocurrency exchanges. The move comes as stablecoins gain traction globally, with the market capitalization of dollar-pegged tokens exceeding $310 billion.

Chan separately met with World Trade Organization Director-General Ngozi Okonjo-Iweala to discuss international trade, reiterating Hong Kong's support for free trade and multilateralism. He also held meetings with officials from Thailand, Egypt, Switzerland and Gulf states, as well as technology investor Robert Smith of Vista Equity Partners.

The Financial Secretary's Davos appearances come as Hong Kong seeks to differentiate itself in an increasingly competitive landscape for digital asset regulation, balancing innovation with investor protection while operating under China's broader restrictions on cryptocurrency activity.

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