HSBC and Standard Chartered First Selected as Hong Kong Stablecoin Issuers

HSBC and Standard Chartered First Selected as Hong Kong Stablecoin Issuers

8 months after stablecoin ordinance implementation… Hong Kong authorities select after reviewing 36 applications

Joint ventures led by HSBC and Standard Chartered have each been selected as Hong Kong's first stablecoin issuers.

According to the South China Morning Post (SCMP) on the 11th, Anchorpoint Financial, a joint venture led by HSBC and Standard Chartered, was granted a stablecoin issuance license by the Hong Kong Monetary Authority (HKMA) on the 10th.

The SCMP pointed out that this comes about 8 months after the Hong Kong government implemented the stablecoin ordinance last year, and the selection announcement was somewhat later than expected.

Previously, the HKMA stated that it would review 36 applications and grant licenses to only a few.

Darryl Chan, Deputy Chief Executive of HKMA, stated, "The two applicants have experience in traditional finance and risk management," adding, "This aligns with stablecoins' role as a bridge connecting traditional finance and digital finance."

Stablecoins are digital assets pegged to fiat currencies such as the dollar, and are a major payment method in the cryptocurrency market. They are promoted as being more stable than general virtual currencies.

HSBC announced that it plans to launch a Hong Kong dollar-based stablecoin in the second half of this year and apply it to its payment app PayMe and mobile banking platform.

In the initial phase of introduction, it will support peer-to-peer transfers and payments between individuals and merchants using stablecoins. It also plans to allow subscriptions to investment products using stablecoins within the app.

Maggie Ng, CEO of HSBC Hong Kong, said, "While stablecoins do not pay interest, they will enable faster payments," adding, "We can offer rewards to encourage their use at banks and merchants."

She further added, "Next year, HSBC may be able to expand stablecoins to be pegged to other currencies."

Anchorpoint, a joint venture established by Standard Chartered, cryptocurrency investment firm Animoca Brands, and Hong Kong Telecommunications, plans to introduce a stablecoin named 'HKD At Par' (HKDAP) starting from the second quarter of this year.

Dominic Maffei, CEO of Anchorpoint, said, "Initially, we will focus on institutional investors," adding, "Stablecoins will lower transaction costs and enable 24-hour payments."

Meanwhile, Hong Kong authorities explained that while stablecoin issuers can decide which currency to peg to, issuing a yuan-based stablecoin requires mainland approval.

Chinese authorities announced a plan in February to prohibit the issuance of yuan stablecoins overseas without authorization.