Singapore, Hong Kong Advance Stablecoin Regulatory Frameworks

In Asia, regulatory frameworks for stablecoins are advancing notably, with Singapore and Hong Kong emerging as key players. Singapore's Monetary Authority has introduced a Stablecoin Issuance Service under the Payment Services Act, focusing on single-currency stablecoins pegged to the Singapore Dollar or G10 currencies, requiring issuers to be based locally and adhere to strict reserve asset conditions. Meanwhile, Hong Kong has enacted new legislation mandating licenses for stablecoin issuers targeting users in its territory, but the Hong Kong Monetary Authority plans to approve only a few issuers initially, potentially delaying first approvals until early 2026. Major financial institutions like Standard Chartered, Bank of China, ICBC, and HSBC have shown strong interest in securing these licenses, signaling a strategic pivot by traditional banks to integrate digital assets. Experts suggest that Hong Kong has a significant opportunity to become a global finance hub for multicurrency stablecoins, emphasizing the necessity of being a first mover to capitalize on this market and centralize related forex, derivatives, and liquidity pools to support international trade. The region's open regulatory approach, allowing stablecoins pegged to multiple fiat currencies, is expected to attract diverse global institutions, enhancing liquidity and competitiveness.