July 28, 2025
By Our Correspondent
On August 1, a new crypto law that targets unlicensed fiat-referenced stablecoin activities will go into effect in Hong Kong. Passed in May, the Stablecoins Ordinance imposes criminal penalties for marketing or selling these digital assets without a license. In the city’s larger regulatory approach for digital assets, the action represents a significant step.
The Hong Kong Monetary Authority (HKMA) has been given permission by the Hong Kong government to supervise and implement the new stablecoin system. Individuals or businesses that advertise or provide fiat-referenced stablecoins without HKMA approval risk fines under the law. Offenders risk a maximum jail sentence of six months and fines of up to HK$50,000.
Fiat-referenced stablecoins are referred to as “specified stablecoins” under the new law, which also strictly regulates them.
Offering, promoting, and facilitating transactions involving these digital assets are all covered by the rules.
Now, organizations engaged in these activities need to apply for licenses or get HKMA exemptions. Any promotional materials or services pertaining to such stablecoins will be deemed unlawful if they are not properly authorized. Only authorized and screened individuals are allowed to use the public area, according to the authorities.
The HKMA has the authority to take administrative measures, such as license revocations and monetary fines, under Part 6 of the law. Depending on the severity of the infractions, Section 134 permits suspensions or complete revocation, while Section 133 permits monetary fines. In order to expose violators and discourage recurrent offenses, the law also requires public notices.
The HKMA now has significant control over stablecoin operations in Hong Kong thanks to this new system. The goal of the law is to deter illegal cryptocurrency activities while creating a compliant financial environment. The city’s objective of creating a safe and open digital asset market is in line with these actions.
The ordinance also specifies the HKMA’s disqualification powers, which enable it to prevent offenders from occupying executive positions in companies that have been granted licenses. Regulators think that these penalties will make market players more accountable. To maintain the integrity of the market, each measure adds another level of oversight.
Hong Kong-based cryptocurrency companies have begun applying to comply with the new license standards. As the deadline draws closer, more than 50 companies are getting ready to apply, according to Bloomberg. Only a few of the applications are anticipated to be approved by authorities.
