The authorities in Hong Kong are exploring regulating stablecoins, as the newest session paper proposed the regulation of fiat-referenced stablecoins (FRS). If the proposed guidelines are carried out, stablecoin issuers in Hong Kong should receive an area license.
The session paper issued by the Monetary Providers and the Treasury Bureau (FSTB) and the Hong Kong Financial Authority (HKMA) outlined stablecoin as “one which purports to keep up a secure worth as regards to a number of fiat currencies.” It additional specified that the businesses “actively market their issuance of FRS to the general public of Hong Kong” have to be licensed.
The authorities will settle for suggestions on the proposed rules till 29 February 2024. The paper elaborated that the need for such rules arrived after the collapse of TerraUSD, an algorithmic stablecoin, final 12 months. Hong Kong’s proposed guidelines won’t license the stablecoins.
“With the implementation of the licensing regime for VA buying and selling platforms from June this 12 months, the legislative proposal to control FRS is one other necessary measure facilitating Web3 ecosystem improvement in Hong Kong,” mentioned Christopher Hui, the Secretary for Monetary Providers and the Treasury.
The Hong Kong authorities is amassing opinions on legislative proposals to oversee stablecoin issuers, requiring that solely stablecoins issued by licensed issuers will be bought to retail buyers, and also will launch a sandbox association. The session interval runs from 27…
— Wu Blockchain (@WuBlockchain) December 27, 2023
Native Presence Is a Should
In keeping with the proposed guidelines, licensed stablecoin issuers should keep a full reserve of property backing the stablecoins “at the very least equal to the par worth.” Additional, the reserves have to be segregated and safely stored. Firms must disclose their reserves and recurrently report back to the regulators.
Moreover, to obtain the license, stablecoin issuers want to determine an area workplace by appointing a Chief Govt Officer, a senior administration crew, and different key personnel.
Hong Kong has already carried out rules across the broader crypto business. The native regulator now provides licenses to cryptocurrency exchanges. A number of crypto exchanges have already established their Hong Kong base for native operations. Nevertheless, Hong Kong doesn’t permit buying and selling in opposition to stablecoins beneath the present guidelines.
In the meantime, stablecoin cash have now change into the main focus of many regulators. Aside from Hong Kong, Singapore additionally introduced in lots of guidelines to control the so-called stablecoins.
The authorities in Hong Kong are exploring regulating stablecoins, as the newest session paper proposed the regulation of fiat-referenced stablecoins (FRS). If the proposed guidelines are carried out, stablecoin issuers in Hong Kong should receive an area license.
The session paper issued by the Monetary Providers and the Treasury Bureau (FSTB) and the Hong Kong Financial Authority (HKMA) outlined stablecoin as “one which purports to keep up a secure worth as regards to a number of fiat currencies.” It additional specified that the businesses “actively market their issuance of FRS to the general public of Hong Kong” have to be licensed.
The authorities will settle for suggestions on the proposed rules till 29 February 2024. The paper elaborated that the need for such rules arrived after the collapse of TerraUSD, an algorithmic stablecoin, final 12 months. Hong Kong’s proposed guidelines won’t license the stablecoins.
“With the implementation of the licensing regime for VA buying and selling platforms from June this 12 months, the legislative proposal to control FRS is one other necessary measure facilitating Web3 ecosystem improvement in Hong Kong,” mentioned Christopher Hui, the Secretary for Monetary Providers and the Treasury.
The Hong Kong authorities is amassing opinions on legislative proposals to oversee stablecoin issuers, requiring that solely stablecoins issued by licensed issuers will be bought to retail buyers, and also will launch a sandbox association. The session interval runs from 27…
— Wu Blockchain (@WuBlockchain) December 27, 2023
Native Presence Is a Should
In keeping with the proposed guidelines, licensed stablecoin issuers should keep a full reserve of property backing the stablecoins “at the very least equal to the par worth.” Additional, the reserves have to be segregated and safely stored. Firms must disclose their reserves and recurrently report back to the regulators.
Moreover, to obtain the license, stablecoin issuers want to determine an area workplace by appointing a Chief Govt Officer, a senior administration crew, and different key personnel.
Hong Kong has already carried out rules across the broader crypto business. The native regulator now provides licenses to cryptocurrency exchanges. A number of crypto exchanges have already established their Hong Kong base for native operations. Nevertheless, Hong Kong doesn’t permit buying and selling in opposition to stablecoins beneath the present guidelines.
In the meantime, stablecoin cash have now change into the main focus of many regulators. Aside from Hong Kong, Singapore additionally introduced in lots of guidelines to control the so-called stablecoins.
