Hong Kong clarified the requirements for stablecoin issuers.

The head of the HKMA, Eddie Yue (, stated that issuers applying for a license need to present a well-developed business plan to the regulator, as well as practical use cases for the issued stablecoins. Applicants also need to address the issue of reserve management.

In addition, the recipient of the HKMA license must have a reserve capital of no less than 25 million Hong Kong dollars )about $3.1 million(. If the applicant is a bank or another financial institution, it may be exempt from the capital requirement.

When requesting regulatory approval, issuers will have to provide information on how they comply with anti-money laundering rules )AML( and what security measures they use.

The head of the HKMA made it clear that issuers do not necessarily have to be participants in the local "regulatory sandbox" for testing stablecoins, and those who have participated in it are not guaranteed to receive a license. Yue stated that the "first batch" of stablecoins will be tested in the context of international trade and in Web3 applications.

Currently, more than 40 applications have been submitted for participation in the government stablecoin sandbox. Requests are coming from large companies including JD CoinChain Technology, Yuanbi Innovation Technology, as well as a consortium that includes Ant Group, Standard Chartered )LON:STAN(, and Hong Kong Telecom. Participants have already tested the issuance of stablecoins and their business models in a controlled environment.

In May, the Legislative Council of Hong Kong approved a bill regulating stablecoins backed by fiat currency. The law is set to take effect on August 1. According to the law, stablecoin issuers will be required to obtain a license from the HKMA.