HSBC and ICBC Set Sights on Hong Kong Stablecoin Licenses Under New Regulatory Regime

HSBC and the Industrial and Commercial Bank of China (ICBC), the world’s largest bank by assets, are preparing to apply for stablecoin licenses in Hong Kong as the region’s ambitious new digital asset framework takes effect.

According to the Hong Kong Economic Journal, both banking giants have indicated their intent to seek authorization from the Hong Kong Monetary Authority (HKMA), signaling a major institutional pivot toward regulated digital finance in Asia.

With Hong Kong’s stablecoin licensing regime going live on August 1, 2025, the first batch of approvals is expected to be highly selective. The HKMA has indicated that only a handful of licenses will be granted initially.

Reports suggest ICBC and Standard Chartered are positioned to secure first-round approvals, potentially gaining a critical first-mover advantage, while HSBC’s application status is closely watched.

Interest in the new framework is intense: as of late August, 77 institutions—ranging from banks to fintech and tech firms—had expressed intent to apply for a license.

Some applicants noted that requirements, which include high capital, strict compliance, full asset backing, and operational security, are stricter than anticipated, raising the bar for would-be issuers and likely favoring established banking groups.

Strict New Standards for Stablecoin Issuers

The Stablecoin Ordinance, now in a six-month transition phase, criminalizes the offering or promotion of unlicensed fiat-referenced stablecoins to retail investors.

Licensed issuers must maintain robust reserves, meet rigorous operational standards, and comply with HKMA’s detailed governance and transparency requirements.

When the new rules first took effect, stablecoin companies operating in Hong Kong reported double-digit losses, with some companies falling as much as 20% in a single day, though local experts describe this as a healthy correction as the landscape professionalizes.

Regulators have also extended scrutiny to crypto custody: the Securities and Futures Commission (SFC) now requires sweeping security standards and explicitly bans the use of smart contracts in cold wallets. These steps reinforce the city’s commitment to a secure, transparent digital asset ecosystem.

The rollout of Hong Kong’s stablecoin licensing framework has drawn significant market attention. But by mid-August, the Securities and Futures Commission (SFC) issued a warning that the heightened speculation around the new rules has also raised the risk of fraud.

In its statement, the regulator noted that hype-driven activity often opens the door to scams. An official urged investors to remain cautious and avoid making rash investment decisions based on market buzz or short-term price momentum.

Industry Impact and Market Outlook

If approved, HSBC and ICBC’s entries could accelerate the adoption of regulated stablecoins across Asia and further cement Hong Kong’s reputation as a gateway for compliant digital asset innovation.

Analysts say the selective nature of the licensing process will consolidate early market leadership among major traditional banks and global financial players.

Hong Kong’s regime could serve as a template for stablecoin oversight worldwide, balancing strong investor protection with institutional confidence in the digital asset sector.