📣[Hong Kong's significant stablecoin regulatory framework is implemented! Chan Mo-po: Balancing safety and innovation to ensure financial stability | Crypto Navigator Fei Yu's interpretation]

Hong Kong's Financial Secretary Paul Chan reiterated at the Belt and Road Summit that Hong Kong adopts a "prudent and risk-based" core approach to the regulation of virtual assets and stablecoins, with the primary goal of ensuring the stability of investors and the financial system.

🔍 Core Regulatory Principles

1. Balance of Security and Innovation: Hong Kong recognizes stablecoins as a bridge connecting traditional finance and digital assets, especially in areas like cross-border payments where efficiency can be improved. However, it also closely monitors the risks involved, such as anti-money laundering challenges and investor protection issues.
2. High Barrier to Entry Licensing System: Hong Kong has established a strict licensing system for stablecoin issuers. Initially, only a limited number of licenses will be granted to ensure that issuers have a sustainable business plan, sufficient technical and financial resources, reliable reserve asset management capabilities, and comprehensive risk management measures.
3. Global Regulation: As long as the stablecoin is pegged to the Hong Kong dollar or promoted to the public in Hong Kong, it is subject to the jurisdiction of Hong Kong regulation, regardless of where it is issued.

📌 The significance to the market and investors

• Enhance market confidence: Clear rules and strict regulations help reduce market uncertainty, attracting traditional capital and compliant institutions to participate.

• Promote compliant applications: Issued stablecoins must have real application scenarios, such as shortening settlement times in cross-border trade and improving capital turnover efficiency in supply chain finance, effectively serving the real economy.

• Risk Control: The regulations require 100% high-quality reserve assets support, independent audits, and ensure users' redemption rights, providing multiple protections for holders.

💡 Flying Fish Perspective

Hong Kong's implementation of a stablecoin licensing system is an important step in building a global Web 3.0 hub and vying for the power to establish digital financial regulations. This move aims to:
• Protecting investors: Reducing fraud and market manipulation risks through strict access and ongoing regulation.

• Maintain financial stability: Prevent systemic risks that stablecoins may pose, such as bank runs and liquidity crises.

• Guide responsible innovation: Encourage the market to explore the true value of blockchain technology in the financial sector under compliance conditions, rather than speculative hype.

For ordinary investors, this means that the compliance stablecoin products seen in the Hong Kong market in the future will greatly enhance their security and reliability.

Hong Kong stablecoin #陈茂波 # fintech #区块链监管 # investor protection

(Disclaimer: The above content is for informational interpretation only and does not constitute any investment advice.)