Hong Kong\u2019s Legislative Council passed the Stablecoin Bill, paving the way for a regulated framework that could position the region as a global leader in digital assets and Web3 development. <\/p>\n
In a May 21 post<\/a> on X, Legislative Council member Johnny Ng Kit-Chong said the bill had passed its third reading, clearing the final hurdle for adoption.<\/p>\n \u201cIt is expected that by the end of this year, major institutions will be able to apply to the Hong Kong Monetary Authority to become licensed stablecoin issuers,\u201d Ng said.<\/p>\n Image of the legislative assembly session. Source:<\/em> Johnny Ng Kit-Chong<\/em><\/a><\/p>\n According<\/a> to the new Hong Kong legislation, stablecoins<\/a> must be backed by fiat currency as underlying assets. Ng said Hong Kong is welcoming \u201cglobal enterprises and institutions interested in issuing stablecoins to apply in Hong Kong,\u201d offering to personally assist with introductions and collaboration:<\/p>\n \u201cI am also happy to facilitate connections and collaborate with all stakeholders to advance the development of Web3 in Asia and globally, with Hong Kong at the center.\u201c<\/p>\n Related: <\/strong><\/em>Hong Kong introduces crypto staking rules, reaffirms Web3 commitment<\/strong><\/em><\/a><\/p>\n Ng said the legislation marks the first step on the road toward building Web3 infrastructure in Hong Kong. \u201cThe most crucial step is to develop more real-world applications.\u201d<\/p>\n Ng said stablecoin adoption has the potential to drive innovation in retail payments, cross-border trade and peer-to-peer transactions. <\/p>\n He added that he encourages the development and adoption of stablecoins, since \u201cthey represent a major financial innovation.\u201d Regarding enhancing market stability, Ng suggested distributing interest earnings to stablecoin holders.<\/p>\n Related: <\/strong><\/em>HashKey receives Hong Kong approval to offer crypto staking services<\/strong><\/em><\/a><\/p>\n According to Ng, \u201cproviding interest will strengthen the competitiveness of stablecoins.\u201d This increased competitiveness, he explained, incentivizes broader participation and expands stablecoin market share, which supports what he views as sustainable growth.<\/p>\n Ng\u2019s remarks that yield-bearing stablecoins are more competitive follow recent positive data. Research indicates that yield-bearing stablecoins have soared to $11 billion<\/a> in circulation, representing 4.5% of the total stablecoin market, a steep climb from just $1.5 billion and a 1% market share at the start of 2024.<\/p>\nHong Kong aims to become a Web3 powerhouse<\/h2>\n
Interest for stablecoin holders<\/h2>\n