Financial institution of China Inventory Surges 6.7% on Shock Stablecoin Issuer License Information — Is a Digital Yuan Rival Coming?

Shares of Financial institution of China Hong Kong unit jumped 6.7% on Monday, closing at HKD 37.58, after native studies revealed the state-owned lender is making ready to use for a stablecoin issuer license underneath Hong Kong’s new regulatory framework.

The information has fueled hypothesis that one in every of China’s largest banks might quickly subject a state-backed stablecoin, probably positioning itself as a rival to the digital yuan.

Based on the Hong Kong Financial Journal, Financial institution of China (Hong Kong) has already shaped a devoted activity drive to check stablecoin issuance. Market sources say the financial institution is actively making ready supplies to grow to be one of many first license candidates, following the Hong Kong Financial Authority’s (HKMA) name for early submissions by the tip of August.

The event comes simply weeks after Hong Kong’s Stablecoin Invoice got here into drive on August 1, establishing one of many world’s first devoted licensing regimes for fiat-referenced stablecoins.

Below the brand new ordinance, any entity issuing fiat-pegged stablecoins in Hong Kong, or overseas if linked to the Hong Kong greenback, should get hold of authorization from the HKMA.

Licensed issuers are required to take care of strict reserve asset administration, segregate consumer funds, and assure redemption at par worth.

The legislation additionally mandates anti-money laundering compliance, danger administration protocols, disclosures, audits, and fit-and-proper checks for administration groups.

The HKMA started accepting expressions of curiosity on August 1 and has set September 30 because the deadline for formal purposes. Officers confirmed they’ve already obtained inquiries from greater than 40 corporations, even earlier than the August 1 regulation took impact.

Main corporations, together with JD.com, Ant Group, Commonplace Chartered, and Circle, publicly said software intentions, whereas legislation corporations report managing consultations for added candidates finalizing supplies.

On August 8, Animoca Manufacturers introduced a three way partnership with Commonplace Chartered Hong Kong and HKT to use for the town’s first stablecoin license.

Hong Kong Positions as Regulated Stablecoin Hub Amid $261B Market Development

The rising competitors has drawn heavy investor curiosity. Hong Kong regulators have cautioned in opposition to market volatility, noting that bulletins about licensing intentions have already triggered sharp inventory actions.

On August 14, the HKMA and Securities and Futures Fee (SFC) issued a joint assertion warning that expressions of curiosity don’t assure approval. They burdened that licenses will solely be granted to candidates that meet the framework’s excessive thresholds.

HKMA chief govt Eddie Yue stated solely a small variety of licenses might be issued initially, underscoring the strict standards. SFC CEO Julia Leung additionally warned buyers in opposition to chasing short-term worth strikes, noting that deceptive claims on social media had already influenced sentiment.

The ordinance’s rollout marks Hong Kong’s bid to place itself as a regulated hub for stablecoins at a time when international market capitalization within the sector has surged to a report $261 billion, after 22 consecutive months of development.

Regulators hope that tighter guidelines will scale back systemic dangers whereas attracting main monetary establishments. Analysts say the framework might encourage non-USD stablecoin options in Asia, probably difficult the greenback’s dominance in regional settlements.

Financial institution of China’s curiosity is particularly important given Beijing’s ongoing rollout of the digital yuan, its central financial institution digital foreign money (CBDC). Whereas the digital yuan stays underneath the direct management of the Folks’s Financial institution of China, a licensed Financial institution of China stablecoin might present a business, internationally accessible counterpart inside a regulated framework.

Some observers imagine such a growth might assist China take a look at the cross-border utility of a digital asset backed by state establishments.

The HKMA has stated it’ll proceed consultations on technical necessities and danger controls, and present issuers are anticipated to transition into compliance over the approaching months.

For now, the Authority has not granted any licenses, and buyers are urged to confirm any issuer’s credentials by way of official channels.

With Hong Kong pushing forward, the stablecoin licensing race is intensifying throughout Asia.

Hong Kong Raises $1.5B in July as Stablecoin Ventures Appeal to Investor Capital

Hong Kong’s push into stablecoins is unfolding in opposition to a broader backdrop of regulatory tightening and investor enthusiasm throughout Asia.

The SFC, on August 15, unveiled new custody requirements for digital asset buying and selling platforms, responding to a wave of worldwide hacks that drained greater than $3 billion from exchanges within the first half of 2025.

The round units minimal necessities for pockets infrastructure, transaction verification, and entry controls as a part of the regulator’s “ASPIRe” roadmap for digital asset safety.

The urgency of the measures was underscored by a recent breach at Turkish trade BtcTurk on August 14, when attackers stole $48 million throughout seven blockchains in underneath 4 seconds, far quicker than most trade alert programs.

Regardless of safety issues, capital continues to pour into Hong Kong’s fast-evolving crypto sector. Publicly listed corporations raised greater than $1.5 billion in July to fund ventures tied to stablecoins, blockchain, and fee networks, in keeping with trade filings.

OSL alone secured $300 million in a fast-tracked share placement, with backing from sovereign wealth and hedge funds.

Notably, a devoted index of stablecoin-related shares has surged 65% this yr, far outpacing the Cling Seng.

The regulatory push is unfolding in opposition to a regional backdrop of fast developments. Japan is making ready to approve its first yen-pegged stablecoin this autumn, whereas China is weighing the launch of yuan-backed tokens to broaden the foreign money’s international footprint.

With Goldman Sachs forecasting trillions in new flows into stablecoins, the sector’s transformation is barely accelerating, and Hong Kong is positioning itself on the heart.

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