Hong Kong will issue its first batch of fiat-referenced stablecoin issuer licenses in March, Financial Secretary Paul Chan said in his 2026-27 budget speech on Wednesday. The move follows the implementation of a licensing regime for stablecoin issuers and signals a shift from consultation to approvals.
Chan told the Legislative Council that regulators will "continue facilitating licensed issuers in Hong Kong to explore different application scenarios in a compliant and risk-controlled manner." He added that the first licenses are expected next month.
The announcement sits within a broader legislative plan. The government will introduce a bill this year to establish licensing regimes for digital asset dealing and custodian service providers. In Hong Kong, digital asset dealing refers to the regulated buying, selling, or exchanging of virtual assets as a business, such as over-the-counter trading. The proposal expands supervision beyond trading platforms and stablecoins.
Liquidity and market quality move to the forefront
Liquidity has become a central theme in the city’s digital asset policy. In his speech, Chan said the Securities and Futures Commission will take further steps to enhance liquidity in Hong Kong’s crypto asset market and enable a broader range of products for professional investors.
"The SFC will also set up an accelerator to expedite market innovation," Chan said.
Earlier this month, Eric Yip, Executive Director of Intermediaries at the Securities and Futures Commission, addressed a conference and outlined the regulator’s direction for 2026.
"This year's focus is on liquidity — cultivating market depth, strengthening price discovery, and building investor confidence through a strategic blend of expanded access and responsible product innovation," Yip said at the time.
The SFC has already announced plans to allow crypto margin financing and derivatives for professional investors. Yip said the agency’s priorities for 2026 center on market quality rather than rapid expansion.
These measures place professional investors at the center of the next phase. The emphasis on price discovery and market depth reflects a policy choice. Authorities aim to broaden products while maintaining investor protection standards.
Tokenized bonds move into core infrastructure
Tokenization of traditional finance instruments forms another pillar of the strategy. Chan confirmed that the government issued its third batch of tokenized bonds in the fourth quarter of last year, totaling HK$10 billion. He said the government will continue issuing tokenized bonds on a regular basis.
This year, CMU OmniClear Holdings Limited, a subsidiary of the Hong Kong Monetary Authority, will establish a new digital asset platform to support the issuance and settlement of digital bonds. The platform will support issuance and settlement and will be gradually extended to other digital assets. It will link with other tokenization platforms in the region.
The budget speech stated that the platform will reinforce Hong Kong’s role in digital assets and strengthen post-trade infrastructure. The integration of tokenized bond settlement into the Central Moneymarkets Unit framework places digital issuance within existing market plumbing.
Chan also said the government will issue guidance clarifying that registers of debenture holders can be kept in the form of a distributed ledger. Authorities will explore the adoption of electronic signatures for bond issuance documents and the digitalization of bearer bonds.
The Hong Kong Monetary Authority launched Ensembleᵀᕽ, the pilot phase of Project Ensemble, last November. The system enables industry participants to conduct real-value transactions involving tokenized deposits and digital assets within a controlled environment. Chan said the HKMA will upgrade the system to support 24/7 settlement and develop local standards to strengthen interoperability with other markets.
Tax transparency and global alignment
On the regulatory front, Hong Kong will amend its Inland Revenue Ordinance over the next two years to implement the Crypto-Asset Reporting Framework and the amended Common Reporting Standard issued by the Organisation for Economic Co-operation and Development. A bill will be introduced in the first half of this year.
The changes align the city with emerging global tax transparency standards for crypto assets and support international efforts to combat cross-border tax evasion.
Together, the stablecoin licensing, expanded dealing and custody rules, liquidity measures, and tokenization infrastructure outline a coordinated policy approach. The government has moved from high-level statements toward operational systems and legislative amendments. March will mark the first formal approvals under the stablecoin regime, with further bills expected to follow later this year.
Roman Zaika
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