September 29, 2025
By Anjali Kochhar
Hong Kong’s financial watchdog has issued a stern warning that no stablecoins pegged to the offshore yuan have been approved in the city, as speculative frenzy around digital assets intensifies. The Hong Kong Monetary Authority (HKMA) declared that any issuance or promotion of such stablecoins without regulatory sanction would be illegal.
In a statement released via WeChat, the HKMA pushed back against social media claims that Hong Kong had already launched its first offshore yuan-pegged stablecoin. The regulator clarified that it has not granted any licences to stablecoin issuers, and that investors should exercise extreme caution when confronted with related marketing or investment propositions.
This reminder comes on the heels of Hong Kong’s new regulatory framework for stablecoins, which took effect in August. Under the updated regime, companies planning to issue stablecoins must comply with stricter licensing, capital, risk management, and disclosure requirements. The intention is to bring greater oversight to a sector that has grown rapidly and attracted both innovation and speculation.
Stablecoins are digital tokens designed to maintain a stable value by being pegged to fiat currencies such as the U.S. dollar, Hong Kong dollar, or yuan. They are widely used in crypto trading to enable fast transfers between assets, and are increasingly viewed as tools for improving cross-border payments and financial inclusion.
However, the HKMA’s message is clear: hype alone cannot substitute for regulatory approval. Any claims of a newly issued yuan stablecoin in Hong Kong are, according to the regulator, misleading and potentially illegal. The authority urged the public to remain vigilant and to report suspicious promotional activities.
By reinforcing its stance, Hong Kong aims to protect retail investors and maintain financial stability while continuing to position itself as a hub for regulated digital finance. The city has been balancing its ambition to attract global Web3 firms with the need to enforce strict compliance standards.
For now, the regulator’s warning underlines that while the potential of stablecoins is vast, their legal and operational frameworks remain tightly controlled. Until proper licences are granted, any yuan-pegged stablecoin promoted as Hong Kong-approved should be treated with skepticism.
About the author
Anjali Kochhar covers cryptocurrency and blockchain stories in India as well as globally. Having been in the field of media and journalism for over four years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.
