Hong Kong Imposes HK$25 Million Capital Mandate for Stablecoin Issuers
Hong Kong has rolled out stringent capital requirements for stablecoin issuers, mandating a minimum reserve of HK$25 million. The move aims to fortify financial stability in the city's burgeoning VIRTUAL asset market. Issuers must now hold highly liquid, low-risk assets to back their stablecoins at a 1:1 ratio with fiat currency.
Redemption mechanisms are under scrutiny. Regulators demand bulletproof processes allowing immediate fiat conversion—a safeguard against liquidity crunches. Independent audits will verify compliance, creating a transparency framework designed to attract global players while protecting investors.
The policy positions Hong Kong as a regulated haven for stablecoin activity, contrasting with more laissez-faire jurisdictions. Market observers note this could accelerate institutional adoption, though some warn of potential innovation constraints.
