The Hong Kong Monetary Authority (HKMA) is set to implement a six-month transition period for new stablecoin regulations, beginning this Friday. During this period, temporary licenses will be issued to compliant issuers, but any failing to meet the new requirements within three months must wind down operations within four months. The HKMA will have capabilities to enforce compliance and investigate suspected noncompliance, leading to potential fines or license revocation. The new rules promise strict requirements, such as backing stablecoins with high-quality liquid reserves, quick redemption processing, and Know Your Customer procedures. There has been a surge of interest before these regulations take effect, with companies like JD.com and Ant International expressing intentions to register for stablecoin issuance. The licensing process aims to initially limit the number of approved issuers as the region gears up for its new regulatory environment.

Source 🔗