Hong Kong's financial secretary, Paul Chan, announced a regulatory sandbox for companies issuing stablecoins. This initiative will allow them to test their products and business models under the supervision of regulators.
The sandbox aims to foster innovation while ensuring investor protection and managing risks associated with stablecoins. This aligns with Hong Kong's commitment to developing a secure and well-regulated Web3.0 environment.
This announcement follows the release of a consultation paper in December 2023 by the Hong Kong Monetary Authority (HKMA) and the Financial Services and the Treasury Bureau (FSTB) proposing licensing requirements for stablecoin issuers.
Furthermore, Hong Kong established a licensing regime for digital asset trading platforms in June 2023, aiming to reclaim its position as a leading crypto hub in Asia. The Securities and Futures Commission warned that unlicensed crypto trading platforms must cease operations by the end of May 2024. Only two platforms, OSL and Hashkey, have secured licenses so far.