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Hong Kong to Regulate Stablecoins With a Risk-Based Approach

The Hong Kong Monetary Authority (HKMA) has announced that it will establish regulatory requirements for stablecoins using a risk-based approach.

According to a press release, the regulator’s decision stemmed from feedback received from a discussion paper released to the public on crypto-assets and stablecoins.

The HKMA released the discussion paper in January 2022 and ended the consultation period in March of the same year. The regulator received 58 submissions from several individuals, public bodies, businesses, and professional organisations.

In the feedback, the respondents expressed their support for the regulator’s plan to regulate stablecoins “with a risk-based and agile approach.”

They also urged the regulator to take the recent market developments into account and draw reference from several international agencies’ regulatory strategies.

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