Hong Kong Plans to Ease Banking Requirements for Stablecoins and Crypto

TLDR

• Hong Kong proposes easing capital requirements for banks holding licensed stablecoins and digital assets.
• The new proposal could reduce regulatory burdens for banks dealing with stablecoins.
• The HKMA introduces CRP-1, a supervisory policy manual to classify crypto under Basel standards.
• Hong Kong’s Stablecoin Ordinance will only allow licensed issuers to operate stablecoins.
• The consultation period for the new rules runs until November 7, 2025, with an expected implementation date of January 1, 2026.

Hong Kong is moving to ease capital requirements for banks holding licensed stablecoins and digital assets. The Hong Kong Monetary Authority (HKMA) introduced a consultation paper outlining new supervisory guidelines. These measures aim to position Hong Kong as a global crypto hub. The changes, if approved, would ease regulatory burdens on banks dealing with stablecoins.

Hong Kong Aims to Attract Crypto Players

The HKMA’s consultation paper outlines a new supervisory policy manual called CRP-1. The manual seeks to classify crypto under Basel Committee standards. According to the proposed guidelines, banks could treat licensed stablecoins as lower-risk assets. This would significantly reduce capital requirements currently imposed by international banking rules.

The proposed regulations are part of Hong Kong’s broader strategy to encourage digital finance. By easing rules for stablecoins, the city aims to attract international crypto players. Stablecoins that meet the proposed standards could be included on bank balance sheets with reduced regulatory constraints. The HKMA’s approach could reduce compliance costs for banks and foster more innovation.

The HKMA has set the consultation period for feedback until November 7, 2025. If approved, the new rules are expected to take effect on January 1, 2026. These changes reflect Hong Kong’s growing ambition to lead the way in the crypto space.

HK Limits Stablecoin Licenses Despite High Demand

The new Stablecoin Ordinance plays a critical role in the proposal. Under this law, only licensed issuers will be allowed to operate stablecoins in Hong Kong. The government expects to issue only a limited number of stablecoin licenses initially. Despite 77 applications, only a few issuers will likely receive approval.

Hong Kong has positioned itself as a gateway for digital finance with stringent licensing requirements. However, the city is also offering policies that promote institutional adoption. This strategy is intended to strike a balance between innovation and risk management. With these moves, Hong Kong looks set to lead in global crypto regulation.

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