Hong Kong's new stablecoin regulatory framework, effective August 1, provides investors with a clear industry roadmap. Reports from J.P. Morgan and Guosen Securities highlight that stablecoin issuers, licensed virtual asset exchanges, and related fintech service providers will be the primary beneficiaries. However, entry into Hong Kong's market isn't universally accessible, and short-term profitability remains challenging due to the market's nascent stage, diversified revenue models, and regulatory hurdles.
Key Market Insights
- Market Scale: Hong Kong's crypto trading volume remains modest compared to global leaders like the U.S., warranting tempered short-term growth expectations.
Revenue Streams:
- Issuers: Earn through reserve asset yields (e.g., short-term U.S. Treasuries).
- Exchanges: Generate fees via trading/clearing services (e.g., OSL charges 0.15%–0.28%).
- Banks & Tech Providers: Offer custody (e.g., ZA Bank) and compliance solutions.
- Regulation-Driven Winners: Entities securing HKMA stablecoin licenses or existing VATP-licensed exchanges will dominate. Retail-focused brokers (e.g., Futu) hold an edge over traditional firms.
👉 Explore licensed exchanges for stablecoin trading
Stablecoin Market: A $230B+ Arena Dominated by Giants
- USDT ($1500B) and **USDC** ($600B) control 87% of the market.
- Classification:
| Type | Example | Risk Profile |
|--------------------|-------------|-----------------------|
| Fiat-backed | USDT, USDC | Low (HK-regulated) |
| Crypto-collateralized | Dai | Moderate |
| Commodity-backed | Tether Gold | Low |
| Algorithmic | (Defunct UST)| High |
Profit Mechanics for Issuers
- Circle's Model: 99% revenue from reserve assets (80% in Treasuries, 20% in banks).
- Hong Kong Restriction: Interest payments to holders prohibited, eliminating "hold-to-earn" strategies.
License Race: Top Contenders
- HKDG: SCB/Animoca/HKT joint venture (HKD-pegged).
- JD-HKD: JD CoinChain (cross-border payments).
- HKDR: RD Technologies (DeFi-focused).
- Ant Group: Plans HK license application.
👉 Compare stablecoin yields and features
Investment Hotspots
- Licensed Exchanges: OSL, HashKey (fee-based revenue).
- Tech Enablers: ZA Bank (custody), Shenzhen InfoTech (blockchain security).
- Retail Brokers: Futu (integrating crypto services via HashKey).
FAQ
Q: Can individuals earn interest on stablecoins in Hong Kong?
A: No. HKMA bans interest payments to stablecoin holders.
Q: Which stablecoins will thrive in Hong Kong?
A: Fiat-backed types (USDT/USDC analogs) due to regulatory preference.
Q: How do exchanges profit from stablecoins?
A: Via trading fees (0.15%–0.28% per transaction).
Q: Are algorithmic stablecoins viable post-UST collapse?
A: Unlikely—HK’s framework excludes high-risk models.
Editorial Team
Last updated: July 2025
### Keyword Integration
- Stablecoin regulations
- Hong Kong crypto market
- Licensed virtual asset exchanges
- Reserve asset yields
- Fiat-backed stablecoins
- HKMA licensing
- VATP牌照
- 跨境支付