Interpretation of the Hong Kong "Stablecoin Regulation Draft": Supporting the Internationalization of the Renminbi and the Financial Development of Hong Kong

The President of the Hong Kong Chinese Culture Association, Gao Jingde, pointed out in an article published today (July 10) on the Big News Network that on May 21, 2025, the Hong Kong Legislative Council passed the "Stablecoin Regulation Draft", making Hong Kong the first region in the world to establish a comprehensive regulatory system for fiat stablecoins. The passage of this bill has attracted widespread attention from the global financial community, especially regarding its profound significance in the internationalization of the Renminbi and the enhancement of Hong Kong's financial status.

Stablecoin and Renminbi Internationalization: New Opportunities in Hong Kong

Stablecoins are a type of cryptocurrency that is pegged to fiat currencies (such as the US dollar, Hong Kong dollar, or Chinese yuan), providing relatively stable value and predictability. Unlike other cryptocurrencies like Bitcoin, which are characterized by high volatility, stablecoins have a more stable value, making them an ideal tool for trading and storing value.

The background of Hong Kong's move is not only due to the local financial development needs but also because of the changes in the international financial landscape, particularly the intensifying financial competition between China and the United States. The U.S. has launched the "GENIUS Act" and other related policies, aiming to expand the dominance of the U.S. dollar in the digital financial sector through stablecoins. Meanwhile, China is accelerating the internationalization of the yuan, and the introduction of stablecoins undoubtedly provides Hong Kong with a good opportunity to connect with the world.

The Strategic Significance of Hong Kong Stablecoin Regulations

Hong Kong's stablecoin regulations not only provide a compliant development platform for offshore Renminbi stablecoins but also accelerate Hong Kong's position as a global center for digital finance and asset management. The legalization of stablecoins and the introduction of relevant regulatory frameworks will allow Hong Kong to secure a place in the global stablecoin market, with projections suggesting that Hong Kong may capture 40% of the stablecoin bond market in the Asia-Pacific region in the coming years.

Compared to other regions such as Singapore and the European Union, Hong Kong's regulations on stablecoins are more flexible, allowing stablecoins to be pegged to multiple fiat currencies such as the Hong Kong dollar, US dollar, and Chinese yuan, providing more options for global stablecoin issuers. As a result, Hong Kong is able to attract more international banks and financial institutions, promoting its emergence as a hub for global stablecoin issuance.

How to promote Hong Kong as a global stablecoin issuance hub

1. Strengthen stablecoin regulation and technical safeguards The Hong Kong Monetary Authority should strengthen the regulation of the stablecoin market to ensure the safety and soundness of the financial system. At the same time, Hong Kong should introduce advanced technologies through technological collaboration with the mainland to enhance the security and technological level of financial infrastructure, preventing potential cyber attacks and financial risks.
2. Accelerate approval efficiency to attract international major banks Hong Kong should expedite the approval process for stablecoin-related applications and enhance the flexibility of the approvals. By simplifying the process and strengthening market promotion, it can attract more international banks and financial institutions to issue stablecoins in Hong Kong.
3. Promote the development of the RMB stablecoin Hong Kong can leverage its unique position as an offshore Renminbi center to become a platform for issuing Renminbi stablecoins. Combined with the strong economic strength of the mainland, Hong Kong has the potential to become an important tool for cross-border payments and trade settlement of the Renminbi globally.
4. Develop a financial development white paper to plan the future development path Hong Kong should formulate a long-term financial development plan, actively promote the development of global digital finance, and further enhance Hong Kong's position in international finance. Issuing a financial development white paper and formulating a specific timetable and roadmap based on global market changes will be key for Hong Kong to further consolidate its status as an international financial center.

Hong Kong Financial Strategic Breakthrough: Promoting the Global Digital Asset Market

The implementation of the Hong Kong stablecoin regulations is not only a breakthrough in Hong Kong's financial strategy but also an important step for Hong Kong to promote the internationalization of the Renminbi and to secure a more advantageous position for China in the global financial arena. Through the deep integration of digital currencies and financial technology, Hong Kong can reduce its dependence on traditional financial platforms like SWIFT and enhance its independence in the global financial system.

In summary, Hong Kong's stablecoin regulations represent a leading model for global digital asset regulation, which will give Hong Kong a competitive edge in future global financial competition and make significant contributions to the transformation of the global financial system.