{"id":4894,"date":"2022-01-15T11:15:13","date_gmt":"2022-01-15T11:15:13","guid":{"rendered":"http:\/\/egrowonline.com\/?p=4894"},"modified":"2022-01-15T11:15:13","modified_gmt":"2022-01-15T11:15:13","slug":"hong-kong-begins-discussions-to-introduce-stablecoin-regulatory-framework","status":"publish","type":"post","link":"http:\/\/egrowonline.com\/?p=4894","title":{"rendered":"Hong Kong begins discussions to introduce stablecoin regulatory framework"},"content":{"rendered":"


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Hong Kong’s central banking institution, the Hong Kong Monetary Authority (HKMA), released a questionnaire to gauge public opinion on regulations for crypto-assets and stablecoins. The state-backed regulator intends to establish a regulatory framework by 2023-24.<\/p>\n

HKMA\u2019s \u201cDiscussion Paper on Crypto-assets and Stablecoins\u201d highlights the explosive growth of the stablecoin market in terms of market capitalization since 2020 and the concurrent regulatory recommendations put forth by international regulators including the United States\u2019 Financial Action Task Force (FATF), the Financial Stability Board (FSB) and The Basel Committee on Banking Supervision (BCBS).<\/p>\n

Market Capitalization of Crypto-assets. Source: HKMA<\/figcaption><\/figure>\n

According<\/a> to the HKMA, the current size and trading activity of crypto-assets may not pose an immediate threat to the stability of the global financial system from a systemic point of view. However, the discussion paper warned:<\/p>\n

\u201cThe growing exposure of institutional investors to such assets as an alternative to or to complement traditional asset classes for trading, lending and borrowing […] indicate growing interconnectedness with the mainstream financial system.\u201d<\/p><\/blockquote>\n

Market Capitalization of Major Stablecoins. Source: HKMA.<\/figcaption><\/figure>\n

Based on the above figure, HKMA\u2019s paper shows that the global market capitalization stood at about $150 billion in December 2021, \u201crepresenting about 5% of the overall crypto-asset market.\u201d The regulator has also shared a list of eight questions to seek policy-related recommendations citing five possible regulatory outcomes \u2014 no action, opt-in regime, risk-based regime, catch-all regime and blanket ban:<\/p>\n

Possible policy options for regulating crypto-assets. Source: HKMA.<\/figcaption><\/figure>\n

HKMA expects stakeholders to submit<\/a> their responses by 31st March 2022, and aims \u201cto introduce the new regime no later than 2023\/24.\u201d<\/p>\n

Major jurisdictions\u2019 regulatory stance towards stablecoins. Source: HKMA.<\/figcaption><\/figure>\n

On an end note, the regulator stated that payment-related stablecoins have a higher potential for being incorporated into the mainstream financial system or even day-to-day commercial and economic activities.\u00a0<\/p>\n

As a result, the HKMA considers expanding the scope of the Payment Systems and Stored Value Facilities Ordinance (PSSVFO), a law that determines the legality of financial products.\u00a0<\/p>\n

Related: <\/strong>Hong Kong real estate giant leads $90M raise for crypto bank Sygnum<\/em><\/strong><\/a><\/p>\n

Complementing the local government\u2019s pro-crypto intentions, one of Hong Kong\u2019s largest property developers Sun Hung Kai invested $90 million in Sygnum, a Swiss bank dedicated to digital asset holding. <\/p>\n

As Cointelegraph reported, the Series B funding round brings Sygnum\u2019s post-money valuation to $800 million, marking a tenfold surge in consolidated revenues from 2021.<\/p>\n<\/div>\n


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Hong Kong’s central banking institution, the Hong Kong Monetary Authority (HKMA), released a questionnaire to gauge public opinion on regulations for crypto-assets and stablecoins. The state-backed regulator intends to establish a regulatory framework by 2023-24. HKMA\u2019s \u201cDiscussion Paper on Crypto-assets and Stablecoins\u201d highlights the explosive growth of the stablecoin market in terms of market capitalization […]<\/p>\n","protected":false},"author":1,"featured_media":4895,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[38],"tags":[235,3627,3098,1343,2415,1344,1323,319],"class_list":["post-4894","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blockchain","tag-begins","tag-discussions","tag-framework","tag-hong","tag-introduce","tag-kong","tag-regulatory","tag-stablecoin"],"jetpack_publicize_connections":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"http:\/\/egrowonline.com\/wp-content\/uploads\/2022\/01\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMDEvYmVhMWYzNDEtNDU4NS00ZDUyLTg2NjktMTkzOTg1OWRiN2FkLmpwZw.jpg","_links":{"self":[{"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/posts\/4894","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=4894"}],"version-history":[{"count":1,"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/posts\/4894\/revisions"}],"predecessor-version":[{"id":4896,"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/posts\/4894\/revisions\/4896"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/media\/4895"}],"wp:attachment":[{"href":"http:\/\/egrowonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4894"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4894"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4894"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}