While the U.S. Stablecoin Genius Act was officially signed into law by Trump, Hong Kong’s stablecoin issuance is entering the final countdown. On August 1st, Hong Kong’s Stablecoin Regulation will formally take effect. Compared to the U.S. stablecoin legislation that sent shockwaves through the crypto world, Hong Kong’s developments have created only ripples in the crypto sphere—but in the stock market, their impact has been surprisingly profound.

Since the passage of Hong Kong’s stablecoin draft, enthusiasm for stablecoins in Hong Kong’s stock market has surged. The Hong Kong stock stablecoin sector has seen a skyrocketing rise, with not only numerous double-digit gains but also several 10x "big bull stocks." Investors are abuzz, and listed companies are celebrating increased capital inflows. Amid this seemingly joyous atmosphere, however, Hong Kong’s regulators have new concerns. Recently, Hong Kong Monetary Authority (HKMA) Chief Executive Eddie Yue wrote an article on the official website titled "Stablecoins: Moving Steadily Toward a Sustainable Future," aiming to cool down the overheated stablecoin market.

Yet, taming a boiling kettle is no easy feat.

On May 21st, Hong Kong’s stablecoin regulation draft was passed by the Legislative Council in its third reading. At the time, with the U.S. stablecoin bill still under Senate review, Hong Kong’s "early move" sparked widespread market discussion. In content, the regulation—featuring a licensing system, 100% full reserves, a HK$25 million paid-up capital requirement, and anti-money laundering (AML) rules—aligns with legislation in other major regions. Public opinion, however, has been sharply divided, painting a paradoxical picture of Hong Kong’s stablecoin landscape.

On one hand, due to Hong Kong’s declining influence in the crypto space and the underwhelming outcomes of past "early moves," the crypto market generally holds a pessimistic view. Critics argue that even with strengthened regulatory frameworks, Hong Kong’s stablecoin sector will likely remain a subsidiary of U.S. dollar stablecoins given limited market demand, serving only as a residual window.

Despite crypto market apathy, other sectors have hailed the news as a major positive. After the regulation passed, 敏锐 industry giants rushed to establish a presence, while traditional media and securities firms competed to cover the story, propelling stablecoins into the mainstream. Discussions on their implications, use cases, and value quickly escalated, even sparking debates on the need for a renminbi stablecoin. This trillion-dollar market appears poised for an explosion.

This Friday, Hong Kong’s stablecoin regulation will take effect, opening license applications. However, a week before the launch, Eddie Yue poured cold water on the hype. In "Stablecoins: Moving Steadily Toward a Sustainable Future," he explicitly noted that stablecoins are being overly conceptualized and show signs of bubbling. Yue stated that only a handful of licenses would be approved initially, urging investors to remain calm and think independently amid market optimism. The HKMA will also seek public feedback on regulatory and AML guidelines, with stricter AML requirements to minimize stablecoins’ misuse for money laundering.

Stablecoin Regulation Imminent: Undercurrents in the Hong Kong Market

These remarks reflect Hong Kong’s concerns about the current market and its cautious stance on license approvals. The reason for the regulator’s public cooling effort is simple: stablecoin fever in Hong Kong has reached excessive levels.

This overheating is most evident in the stock market. The contrast between promising prospects and early-stage development has turned stablecoins into an attractive capital narrative, driving rapid, immediate gains for nearly all related stocks.

Guotai Junan International, after obtaining a securities trading license in June (becoming the first Chinese brokerage to offer full-chain virtual asset services), surged 198% on June 25th, with a year-to-date gain of 458%.

On July 7th, Goldstream Investment announced a strategic cooperation framework with AnchorX to explore cross-border payments, trade, and stablecoin use case expansion. The next day, Goldstream’s stock soared 533.17% on heavy volume.

Stablecoin Regulation Imminent: Undercurrents in the Hong Kong Market

On July 15th, China 33 Media announced plans to apply for a stablecoin license. On July 16th, its stock closed up 72.73%, with a year-to-date surge of 1,495%.

Stablecoin Regulation Imminent: Undercurrents in the Hong Kong Market

A single announcement triggering such sharp gains underscores the power of the stablecoin narrative. Beyond these new entrants, established 概念股 have also rallied: OKLink, Yunfeng Financial, Yixin Group, New Fire Technology Holdings, and OSL Group have all gained over 100% this year. Even China’s A-share market, long criticized for stagnation, has been stirred, with digital yuan 概念股 like Hengbao Co., Sifang Jingchuang, and Chu Tianlong seeing multi-fold increases.

Against this backdrop, a rush has ensued: "chameleon" companies capitalizing on trends, financial institutions seeking a slice of the pie, and strategic giants aiming to reduce settlement costs or build moats. According to Caixin, 50-60 companies—including mainland Chinese central enterprises, financial institutions, and internet giants—have expressed interest in applying for Hong Kong stablecoin licenses.

However, application enthusiasm does not translate to approval ease. The HKMA notes that most applicants remain at the conceptual stage, lacking real-world use cases, while those with use cases often lack the technology to issue stablecoins or experience in managing financial risks. Issuing stablecoins purely for the sake of issuance is not what Hong Kong wants, hence the HKMA’s emphasis on granting only a handful of initial licenses.

To manage the influx, the HKMA plans a pre-screening mechanism. Sources cited by Caixin indicate that licenses will not be issued via open applications; instead, a quasi-invitation system will be used. The HKMA will pre-communicate with potential applicants to assess basic eligibility, and only those meeting initial criteria will receive application forms.

As for who will secure licenses, market sentiment favors participants in Hong Kong’s stablecoin sandbox pilot. Launched in July 2024, the sandbox included JD Coin Chain Technology, Circle Innovation Technology, and a Standard Chartered-led consortium (with Standard Chartered, Animoca Brands, and Hong Kong Telecom). Now in its second phase, the HKMA stresses that sandbox participation does not guarantee licensing, and participants must still apply formally. Nevertheless, their experience in testing use cases and risk controls under regulatory guidance gives them an edge in navigating compliance requirements.

Stablecoin Regulation Imminent: Undercurrents in the Hong Kong Market

Overall, Hong Kong’s license evaluation focuses on three key areas:

1. Technical capability to meet issuance requirements;

2. Practical use cases with feasible implementation plans;

3. Risk control capabilities, particularly in preventing money laundering via stablecoins.

Objectively, large enterprises with existing cross-border financial and payment operations and robust risk management systems hold an advantage. Smaller firms face slim approval chances, often acting as "also-rans."

For now, despite the HKMA’s calls for calm, market FOMO (fear of missing out) is unlikely to subside soon.

First, U.S. and Hong Kong stablecoin developments are interconnected. Following the passage of the U.S. Genius Act, stablecoin enthusiasm remains high, with Circle hitting new highs and major institutions expressing strong interest. Combined with positive crypto market sentiment and expected rate cuts, the U.S. stablecoin narrative will persist and spill over into Hong Kong.

Second, Hong Kong’s stablecoin discourse is expanding. Initially focused on Hong Kong dollar stablecoins, discussions now center on the need for an offshore renminbi stablecoin. National think tanks (e.g., the National Financial Development Research Institute), local governments (e.g., Shanghai State-owned Assets Supervision and Administration Commission), securities firms, and civil organizations have all joined the debate. Many argue for piloting an offshore renminbi stablecoin in Hong Kong, with future expansion to domestic offshore zones like free trade 试验区. Previously, Hong Kong’s slow Web3 development was attributed to blocked channels; a viable offshore renminbi stablecoin could unlock growth potential and reshape the financial system long-term.

Crucially, stablecoins represent a profitable, growing market with a forming industry chain. For issuers:

• Retail-focused issuers can reduce transaction costs and boost competitiveness;

• Payment-focused issuers aim to penetrate digital asset markets and expand global financial infrastructure;

• Even firms seeking to boost stock prices through narratives have incentives to participate.

Amid the hype, over five groups—including ZhongAn Online, 4Paradigm, JiaMi Technology, and Easou Technology—have announced large-scale share placements. OSL Group, for instance, plans to raise nearly HK$2.4 billion by placing over 101 million shares at HK$14.9 each. Beyond issuance, virtual asset trading platforms (for monetizing traffic) and banks (as custodians) are also actively positioning themselves to capture industry .

Given these factors, stablecoin speculation will persist ，with license competition intensifying as compliance becomes a key entry barrier. However, the license’s actual influence, business viability, and associated costs (HK$25 million in capital plus potential annual compliance fees exceeding HK$1 million) warrant caution. Without a strong business model, hasty applications may backfire. As the HKMA noted, only a few will thrive long-term, while trend-chasers will likely fade after regulatory scrutiny.

For stock investors, extra vigilance is advised.

While the U.S. Stablecoin Genius Act was officially signed into law by Trump, Hong Kong’s stablecoin issuance is entering the final countdown. On August 1st, Hong Kong’s Stablecoin Regulation will formally take effect. Compared to the U.S. stablecoin legislation that sent shockwaves through the crypto world, Hong Kong’s developments have created only ripples in the crypto sphere—but in the stock market, their impact has been surprisingly profound.

Since the passage of Hong Kong’s stablecoin draft, enthusiasm for stablecoins in Hong Kong’s stock market has surged. The Hong Kong stock stablecoin sector has seen a skyrocketing rise, with not only numerous double-digit gains but also several 10x "big bull stocks." Investors are abuzz, and listed companies are celebrating increased capital inflows. Amid this seemingly joyous atmosphere, however, Hong Kong’s regulators have new concerns. Recently, Hong Kong Monetary Authority (HKMA) Chief Executive Eddie Yue wrote an article on the official website titled "Stablecoins: Moving Steadily Toward a Sustainable Future," aiming to cool down the overheated stablecoin market.

Yet, taming a boiling kettle is no easy feat.

On May 21st, Hong Kong’s stablecoin regulation draft was passed by the Legislative Council in its third reading. At the time, with the U.S. stablecoin bill still under Senate review, Hong Kong’s "early move" sparked widespread market discussion. In content, the regulation—featuring a licensing system, 100% full reserves, a HK$25 million paid-up capital requirement, and anti-money laundering (AML) rules—aligns with legislation in other major regions. Public opinion, however, has been sharply divided, painting a paradoxical picture of Hong Kong’s stablecoin landscape.

On one hand, due to Hong Kong’s declining influence in the crypto space and the underwhelming outcomes of past "early moves," the crypto market generally holds a pessimistic view. Critics argue that even with strengthened regulatory frameworks, Hong Kong’s stablecoin sector will likely remain a subsidiary of U.S. dollar stablecoins given limited market demand, serving only as a residual window.

Despite crypto market apathy, other sectors have hailed the news as a major positive. After the regulation passed, 敏锐 industry giants rushed to establish a presence, while traditional media and securities firms competed to cover the story, propelling stablecoins into the mainstream. Discussions on their implications, use cases, and value quickly escalated, even sparking debates on the need for a renminbi stablecoin. This trillion-dollar market appears poised for an explosion.

This Friday, Hong Kong’s stablecoin regulation will take effect, opening license applications. However, a week before the launch, Eddie Yue poured cold water on the hype. In "Stablecoins: Moving Steadily Toward a Sustainable Future," he explicitly noted that stablecoins are being overly conceptualized and show signs of bubbling. Yue stated that only a handful of licenses would be approved initially, urging investors to remain calm and think independently amid market optimism. The HKMA will also seek public feedback on regulatory and AML guidelines, with stricter AML requirements to minimize stablecoins’ misuse for money laundering.

Stablecoin Regulation Imminent: Undercurrents in the Hong Kong Market

These remarks reflect Hong Kong’s concerns about the current market and its cautious stance on license approvals. The reason for the regulator’s public cooling effort is simple: stablecoin fever in Hong Kong has reached excessive levels.

This overheating is most evident in the stock market. The contrast between promising prospects and early-stage development has turned stablecoins into an attractive capital narrative, driving rapid, immediate gains for nearly all related stocks.

Guotai Junan International, after obtaining a securities trading license in June (becoming the first Chinese brokerage to offer full-chain virtual asset services), surged 198% on June 25th, with a year-to-date gain of 458%.

On July 7th, Goldstream Investment announced a strategic cooperation framework with AnchorX to explore cross-border payments, trade, and stablecoin use case expansion. The next day, Goldstream’s stock soared 533.17% on heavy volume.

Stablecoin Regulation Imminent: Undercurrents in the Hong Kong Market

On July 15th, China 33 Media announced plans to apply for a stablecoin license. On July 16th, its stock closed up 72.73%, with a year-to-date surge of 1,495%.

Stablecoin Regulation Imminent: Undercurrents in the Hong Kong Market

A single announcement triggering such sharp gains underscores the power of the stablecoin narrative. Beyond these new entrants, established 概念股 have also rallied: OKLink, Yunfeng Financial, Yixin Group, New Fire Technology Holdings, and OSL Group have all gained over 100% this year. Even China’s A-share market, long criticized for stagnation, has been stirred, with digital yuan 概念股 like Hengbao Co., Sifang Jingchuang, and Chu Tianlong seeing multi-fold increases.

Against this backdrop, a rush has ensued: "chameleon" companies capitalizing on trends, financial institutions seeking a slice of the pie, and strategic giants aiming to reduce settlement costs or build moats. According to Caixin, 50-60 companies—including mainland Chinese central enterprises, financial institutions, and internet giants—have expressed interest in applying for Hong Kong stablecoin licenses.

However, application enthusiasm does not translate to approval ease. The HKMA notes that most applicants remain at the conceptual stage, lacking real-world use cases, while those with use cases often lack the technology to issue stablecoins or experience in managing financial risks. Issuing stablecoins purely for the sake of issuance is not what Hong Kong wants, hence the HKMA’s emphasis on granting only a handful of initial licenses.

To manage the influx, the HKMA plans a pre-screening mechanism. Sources cited by Caixin indicate that licenses will not be issued via open applications; instead, a quasi-invitation system will be used. The HKMA will pre-communicate with potential applicants to assess basic eligibility, and only those meeting initial criteria will receive application forms.

As for who will secure licenses, market sentiment favors participants in Hong Kong’s stablecoin sandbox pilot. Launched in July 2024, the sandbox included JD Coin Chain Technology, Circle Innovation Technology, and a Standard Chartered-led consortium (with Standard Chartered, Animoca Brands, and Hong Kong Telecom). Now in its second phase, the HKMA stresses that sandbox participation does not guarantee licensing, and participants must still apply formally. Nevertheless, their experience in testing use cases and risk controls under regulatory guidance gives them an edge in navigating compliance requirements.

Stablecoin Regulation Imminent: Undercurrents in the Hong Kong Market

Overall, Hong Kong’s license evaluation focuses on three key areas:

1. Technical capability to meet issuance requirements;

2. Practical use cases with feasible implementation plans;

3. Risk control capabilities, particularly in preventing money laundering via stablecoins.

Objectively, large enterprises with existing cross-border financial and payment operations and robust risk management systems hold an advantage. Smaller firms face slim approval chances, often acting as "also-rans."

For now, despite the HKMA’s calls for calm, market FOMO (fear of missing out) is unlikely to subside soon.

First, U.S. and Hong Kong stablecoin developments are interconnected. Following the passage of the U.S. Genius Act, stablecoin enthusiasm remains high, with Circle hitting new highs and major institutions expressing strong interest. Combined with positive crypto market sentiment and expected rate cuts, the U.S. stablecoin narrative will persist and spill over into Hong Kong.

Second, Hong Kong’s stablecoin discourse is expanding. Initially focused on Hong Kong dollar stablecoins, discussions now center on the need for an offshore renminbi stablecoin. National think tanks (e.g., the National Financial Development Research Institute), local governments (e.g., Shanghai State-owned Assets Supervision and Administration Commission), securities firms, and civil organizations have all joined the debate. Many argue for piloting an offshore renminbi stablecoin in Hong Kong, with future expansion to domestic offshore zones like free trade 试验区. Previously, Hong Kong’s slow Web3 development was attributed to blocked channels; a viable offshore renminbi stablecoin could unlock growth potential and reshape the financial system long-term.

Crucially, stablecoins represent a profitable, growing market with a forming industry chain. For issuers:

• Retail-focused issuers can reduce transaction costs and boost competitiveness;

• Payment-focused issuers aim to penetrate digital asset markets and expand global financial infrastructure;

• Even firms seeking to boost stock prices through narratives have incentives to participate.

Amid the hype, over five groups—including ZhongAn Online, 4Paradigm, JiaMi Technology, and Easou Technology—have announced large-scale share placements. OSL Group, for instance, plans to raise nearly HK$2.4 billion by placing over 101 million shares at HK$14.9 each. Beyond issuance, virtual asset trading platforms (for monetizing traffic) and banks (as custodians) are also actively positioning themselves to capture industry .

Given these factors, stablecoin speculation will persist ，with license competition intensifying as compliance becomes a key entry barrier. However, the license’s actual influence, business viability, and associated costs (HK$25 million in capital plus potential annual compliance fees exceeding HK$1 million) warrant caution. Without a strong business model, hasty applications may backfire. As the HKMA noted, only a few will thrive long-term, while trend-chasers will likely fade after regulatory scrutiny.

For stock investors, extra vigilance is advised.