Hong Kong’s New Stablecoin Regime: Implications for Indian Crypto Firms
Hong Kong has established Asia's first comprehensive licensing framework for fiat-referenced stablecoins, with the Stablecoins Bill taking effect August 1, 2025. The legislation mandates licenses for issuers, marketers, or redeemers of fiat-backed stablecoins in Hong Kong, with severe penalties for non-compliance.
The regime requires 1:1 reserve backing with high-quality assets, monthly attestations, and quarterly audits. Algorithmic stablecoins like Terra's UST are explicitly banned. With HK$25 million minimum capital requirements, the framework offers Indian crypto startups a regulated offshore base while maintaining strict oversight.