HSBC and the Industrial and Commercial Bank of China (ICBC), the world’s largest bank by total assets, are reportedly preparing to apply for stablecoin licenses in Hong Kong, as the city’s brand-new regulatory regime begins to take effect.
According to a report published Monday in the Hong Kong Economic Journal, both institutions have signaled their intention to file applications with the Hong Kong Monetary Authority (HKMA). While neither HSBC nor ICBC provided comments when contacted, the report suggests that both banks see stablecoin issuance as a strategic move to position themselves at the forefront of Hong Kong’s emerging regulated crypto-finance ecosystem.
Related reporting: StablecoinX has expanded its financing commitment for Ethena’s ENA treasury to $890 million, further strengthening support for the project’s growth.
The HKMA has previously indicated that only a limited number of licenses will be issued in the first round. Reports suggest that ICBC and Standard Chartered are among the strongest contenders to receive approval early, which would give them a valuable first-mover advantage in the tightly regulated stablecoin space.
Interest in the new licenses is already substantial. By the end of August, 77 institutions had expressed a desire to apply, according to the Hong Kong Economic Journal. However, several applicants have reportedly described the licensing requirements as more demanding than expected, underscoring Hong Kong’s intent to build a highly secure and tightly controlled stablecoin market.
Industrial and Commercial Bank of China. Source: Wikimedia
Stricter entry standards reshape Hong Kong stablecoin landscape
On Aug. 1, Hong Kong’s Stablecoin Ordinance officially came into force, kicking off a six-month transition period for companies operating in the region. The law introduces sweeping new requirements, making it a criminal offense to offer or promote unlicensed fiat-referenced stablecoins to retail investors.
The bar for entry has been set deliberately high. Stablecoin issuers must comply with robust capital requirements, risk management standards, and transparency obligations to obtain approval. As a result, many companies already active in the market reported significant financial losses following the rollout of the rules, with some seeing their valuations drop by as much as 20% in a single day.
Local market observers, however, have described the pullback as a “healthy correction,” reflecting the market’s adjustment to the reality of stricter regulation. Beyond stablecoins, regulators in Hong Kong have already started extending oversight to related sectors. In mid-August, the Hong Kong Securities and Futures Commission (SFC) published guidance on cryptocurrency custody standards, introducing sweeping security requirements and banning the use of smart contracts in cold wallet implementations.
New stablecoin regime draws global interest and fraud warnings
Hong Kong’s ambitious regulatory framework has attracted worldwide attention from financial institutions and crypto companies eager to access the region’s growing digital asset hub. However, regulators have also been quick to issue cautionary notes about the risks of hype and speculation.
In mid-August, shortly after the licensing regime took effect, the SFC warned that the heightened publicity surrounding the rollout could increase the risk of scams and fraudulent offerings. Officials advised investors to remain cautious, urging them to avoid making decisions based on hype, fear of missing out, or sudden price movements.
The combined oversight from the HKMA and SFC underscores Hong Kong’s commitment to positioning itself as a global leader in regulated stablecoin markets, while still seeking to protect investors from the risks of speculation and fraud.