 ▲ Stablecoin, HSBC, Standard Chartered/AI-generated image |
Hong Kong is accelerating its integration with the institutional financial system by granting licenses to large, well-capitalized note-issuing banks in a bid to seize dominance in the global stablecoin market.
According to crypto-focused outlet BeInCrypto on March 13 (local time), the Hong Kong Monetary Authority (HKMA) is set to grant Hong Kong’s first stablecoin issuance licenses to HSBC and Standard Chartered. After reviewing a total of 36 applications, authorities decided to prioritize approval for a limited number of financial institutions with outstanding asset scale and regulatory compliance capabilities. Under the Stablecoin Ordinance that took effect in August 2025, any entity seeking to issue fiat-backed stablecoins in Hong Kong must obtain a license from the HKMA.
The advantage held by note-issuing banks—authorized to issue Hong Kong currency—in this licensing process underscores regulators’ emphasis on strong capital reserves and strict supervision as top priorities. Standard Chartered proactively participated in the HKMA’s sandbox program, which began in July 2024, through a joint venture with Animoca Brands and Hong Kong Telecommunications Ltd. (HKT). Although HSBC did not take part in the sandbox, it is considered a leading candidate for the first round of approvals due to its status as the bank with the largest asset base in Hong Kong.
Bank-led stablecoin issuance is expected to mark a significant turning point, accelerating the adoption of tokenized payment systems for both institutional and retail investors. Standard Chartered warned that “as much as $500 billion in U.S. bank deposits could migrate to stablecoins by 2028,” suggesting that digital assets may increasingly replace traditional financial assets. Hong Kong’s approach is also setting a new benchmark for how global regulators may encourage participation from the banking sector when selecting stablecoin issuers.
As of March 2026, the global stablecoin market reached an all-time high of $313 billion, and Citi Group projects that the market could expand to between $1.9 trillion and $4 trillion in the coming years. The widening regulatory gap with mainland China—where onshore tokenization of real-world assets has recently been banned—has further strengthened Hong Kong’s competitiveness as a digital asset hub. Financial Secretary Paul Chan stated last February that “only a very limited number of licenses will be issued initially,” with the first approval results expected as early as March 24.
The introduction of the stablecoin licensing regime represents a core phase of Hong Kong’s digital asset hub strategy, which has been underway since 2022. Private firms such as virtual asset exchange OSL are also reportedly in contention for inclusion in the first round of approvals, raising expectations for enhanced market liquidity and stability. This institutional integration is viewed as a crucial step in the process of establishing stablecoins not merely as alternative assets but as a standard within the global payment system.
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