Hong Kong Regulators Caution Against Unapproved Stablecoins
The Hong Kong Monetary Authority (HKMA) has issued a warning to investors about unapproved stablecoins, especially those pegged to the Chinese yuan. The agency has not issued any licenses for stablecoin issuers yet.
Since the Stablecoin Ordinance took effect, there has been a surge in interest in the digital asset sector. Many firms are lining up to become licensed stablecoin issuers under the HKMA. Though, the financial agency has cautioned local investors against investing in unapproved stablecoins.
according to a recent report by the SCMP, the HKMA has denied claims circulating on social media that a yuan-pegged stablecoin has been officially issued under the Stablecoin Ordinance from Hong Kong. the agency has yet to distribute any stablecoin issuer licenses.
Just a week ago, Hong Kong-based firm AnchorX launched an offshore stablecoin pegged to the yuan, dubbed AxCNH. Although the HKMA has not issued any licenses, AnchorX claims it holds a valid license from the Astana financial services Authority in Kazakhstan.
The stablecoin is intended to facilitate cross-border payments for offshore Chinese enterprises and countries involved in the Belt and Road Initiative. AnchorX also plans to expand use cases for AxCNH in digital-asset trading and real-world asset tokenization.
Hong Kong regulators have stated that it is indeed unlikely to grant stablecoin issuer licenses within this year. So far, at least 77 institutions have expressed interest in registering for a stablecoin issuer, including state-owned firms from China.
The surge in stablecoin interest has sparked a market boom in Hong Kong’s digital asset sector. However, the China Securities Regulatory Commission has reportedly ordered local brokerages to halt tokenization activities in Hong Kong.
Earlier in August, the Hong Kong Securities and Futures Commission recorded a rise in fraud risks related to digital assets after the stablecoin Ordinance came into effect.
