More than 40 companies are actively preparing to apply for stablecoin licenses in Hong Kong, as the city’s new regulatory regime for fiat-backed digital assets comes into effect on August 1, 2025. Despite this strong interest, financial regulators are expected to approve only a small number of applicants due to stringent eligibility requirements, according to reports from Chinese media.

The licensing framework, announced by the Hong Kong Monetary Authority (HKMA) in June, mandates that all fiat-referenced stablecoin issuers must obtain official authorization to operate. This includes issuers based outside Hong Kong if their products are accessible to Hong Kong users. The initiative is part of Hong Kong’s broader push to become a regional hub for regulated digital finance, while ensuring investor protection and systemic risk management.

“We are seeing substantial interest, but approvals will be selective. We aim for quality over quantity,” said Eddie Yue, Chief Executive of the HKMA, during a recent press briefing.

Strict Entry Requirements

Applicants must meet rigorous compliance, risk management, and capital standards. Requirements include:

• Minimum HK$25 million in paid-up capital (excluding licensed banks),

• Demonstrated 1:1 backing of stablecoins by fiat assets,

• Strong governance and AML protocols,

• Adequate redemption mechanisms.

The HKMA also requires license holders to be incorporated in Hong Kong and maintain sufficient operational presence in the territory.

Key Contenders and Market Dynamics

Prominent names reportedly preparing applications include JD CoinChain, Ant Group, and a consortium of Standard Chartered, Animoca Brands, and HKT. These firms are among the participants in HKMA’s regulatory sandbox, which launched earlier this year to test operational models for stablecoin issuance under close supervision.

While over 40 entities have expressed interest, the HKMA is expected to approve fewer than 10 licenses in the first phase, prioritizing applicants with institutional backing, mature risk controls, and real-world use cases.

“We expect just a handful of licenses in the beginning,” said an executive from a mainland fintech firm familiar with the matter. “The bar is set high, which is good for the industry long-term.”

Regional Significance

The rollout positions Hong Kong ahead of many jurisdictions in Asia in formalizing stablecoin rules. It is widely seen as a counterweight to Singapore’s more mature digital asset ecosystem, and a complement to mainland China’s cautious but evolving stance on crypto regulation.

Experts say the move could help establish trust in stablecoins used for cross-border payments, e-commerce, and tokenized financial services—particularly among institutional users and financial service providers seeking regulatory certainty.