Is the Hong Kong stablecoin doomed?

Recently, the news about stablecoin licenses has further fermented: only Financial Institutions can obtain licenses, and there are widespread rumors about major companies withdrawing.

Beyond the insiders, let's return to a few fundamental questions and discuss regulatory documents and practical experiences.

TL;DR:

• According to Hong Kong regulations, KYC/wallet real-name = reliance on amount triggers + division of roles among three licensed institutions (issuer, bank, and exchange), not a priori obstacles. Moreover, Hong Kong indeed has stricter requirements for real-name verification of issuers in practical communication.

• The requirements for wallet real-name verification in Hong Kong, Singapore, and the EU are highly similar. Hong Kong is not an exception! Additionally, the regulatory bodies for wallets in Hong Kong (SFC) and stablecoins (HKMA)) are different. In Singapore, it is the same regulatory body, which is MAS.

• The payment system for major manufacturers' real-name KYC/AML for e-wallet/card payments has already been established, but the reflection of this off-chain capability onto the chain requires time and additional compliance costs.

• The EU and the US require that only licensed Financial Institutions can apply for stablecoin licenses, which has blocked many applicants. Currently, Singapore and Hong Kong have not made this clear.

Q1. Does Hong Kong require "all individuals to complete KYC / wallet real-name verification"?

Answer:

1. KYC + self-custody wallet control verification must be completed by any one of the issuer / exchange / bank only when a single or cumulative transfer ≥ 8,000 HKD (≈ 1,020 USD).

2. Small amounts (< 8,000 HKD) can be simplified, but when facing sanctions or high risks, full information must be provided.

3. If banks or large exchanges have conducted due diligence, smaller issuers can rely on their results to avoid redundant collection.

➡ Not everyone needs to be verified first, but rather it is triggered by the amount + division of labor.

Q2. Is the regulation of stablecoins in Hong Kong stricter than that of the EU and Singapore?

To be divided by dimensions:

• Capital / Reserves: Hong Kong's strictest (Net assets ≥ 50 million HKD, reserves 80% cash).

• AML threshold: Hong Kong 8,000 HKD, more lenient than the EU / Singapore 1,000 EUR/SGD.

• Technical governance: Hong Kong mandates freeze; Singapore adds claw-back; the EU requires on-chain traceability.

Conclusion: Each has its focus, there is no "comprehensively the strictest."

Q3. Can USDT and USDC still be used? (Here comes the key point)

Core: Circulates in all three regions, but regulatory identities differ

1. European Union (MiCA)

• Circle has become a compliant stablecoin and can continue to be listed on all EU exchanges.

• Tether has not publicly applied; the trading platform has delisted USDT.

2. Singapore (PSA / Stablecoin Notice)

• Currently, both are "general DPT" and can be used freely.

• If you want to sell under the title of "regulated stablecoin", the issuer must establish a presence in Singapore and obtain an MAS license - both Circle and Tether have not yet completed this.

3. Hong Kong (HKMA stablecoin license)

• Retail users in Hong Kong are currently unable to use USDT/USDC on licensed exchanges and can only use compliant OTC/on-chain P2P. Moreover, after 2026, unlicensed coins will face greater tightening risks in fiat channels.

Q4. Will large platforms face application obstacles due to "inability to implement real-name system"?

Basically won't.

• Leading platforms already have global KYC / AML infrastructure;

• Wallet addresses can be bound through off-chain real-name + on-chain signature.

• Hong Kong allows reliance on third-party due diligence, banks or compliance service providers can provide bulk wallet verification.

The real challenge lies in the integration of on-chain and off-chain capabilities across multiple countries.

Q5. What other "exceptions" or breathing space are there in the three regions?

1. Hong Kong: ≤ 2,000 users or ≤ 100 million HKD in circulation can apply for Regulatory Sandbox.

2. Singapore: The consultation draft proposes a Pilot Programme with limited quotas and a named system by MAS.

3. European Union: Very small scale CASP can use lightweight processes, but must still register and comply with TFR.

The window is tightening - Singapore has lowered the threshold to 1,000 SGD, while Hong Kong hints at being very tight.

Q6: Can only licensed Financial Institutions apply for stablecoin?

1. The U.S. "Genius Act" locks the door the tightest: No financial license = No issuance of payment stablecoins.

2. The EU requires that only licensed EMI institutions can apply for a stablecoin license, which has blocked many applicants. Currently, Singapore and Hong Kong have not made this explicit.