The Great Change of Stablecoins: From the United States to Hong Kong, an Overview of the Global Regulatory Landscape

Stablecoins are stepping out of the gray area and moving towards regulated financial norms, with the currency-level dividend window gradually opening.

Written by: imToken

Stablecoin, the product form in crypto finance that is closest to RWA, is迎来 an unprecedented regulatory upheaval.

On June 18, 2025, at midnight, the U.S. Senate passed the “GENIUS Act” (Giving Every Nation a United Stablecoin) with 68 votes in favor and 30 against, which is hailed as a milestone in cryptocurrency payment legislation. This marks the first time that a clear compliance path for stablecoins has been established at the federal level in the United States, signifying a key turning point for crypto assets from technical experimentation to institutionalization.

At the same time, Hong Kong is also making proactive arrangements through the “Stablecoin Ordinance” and future relevant license applications, and will officially accept stablecoin issuance license applications on August 1, becoming the world’s first financial center to implement a local stablecoin licensing mechanism.

As stated in “Traditional Institutions Entering the Arena: Positions, Stablecoins, and Legislation Advancing Together, Are Giants Reshaping Web3?”, the new compliance cycle represented by the United States and Hong Kong may profoundly reshape the position of stablecoins in the global financial system. The underlying currents behind all these variables are accelerating to the forefront.

01 USA: The First Shot in Stablecoin Compliance

What has been the most successful crypto financial product globally in the past 5 years?

The answer is not hard to guess; it is neither on-chain financial innovations like Uniswap that ignited the DeFi Summer, nor digital artworks like CryptoPunks that triggered the NFT craze, but rather the stablecoins that everyone has long been accustomed to.

Indeed, outside of DeFi and NFT games that inherently attract large users, stablecoins aimed at ordinary users have undoubtedly become one of the widely accepted use cases for both crypto and non-crypto users. They are gradually becoming an important bridge in on-chain payments, cross-border settlements, financial transactions, and even in Web2 scenarios, significantly broadening and deepening the user base of the crypto economy.

However, objectively speaking, its widespread application has always been in a gray area - lack of unified regulation, opaque reserve mechanisms, and ambiguous legal attributes have become key issues that hinder institutional entry and mainstream adoption.

As a barometer of global financial regulations, the passage of the U.S. “GENIUS Act” is undoubtedly of milestone significance. This act comprehensively defines stablecoin, issuance qualifications, reserve mechanisms, and user rights at the federal level for the first time. Key points include: mandatory 1:1 reserve backing, requiring all issuers to maintain fiat reserves equivalent to the stablecoins issued, allowing users to redeem their held stablecoins at a 1:1 ratio at any time.

At the same time, the issuance qualifications are limited to banks, licensed non-bank financial institutions, and auditing compliant enterprises, with a wide range of applicable targets, including enterprise liquidation stablecoins and consumer payment stablecoins. This means that the stablecoin business, which has long been operating in a gray area, will enter a regulatory framework for the first time, characterized by “laws to follow and regulations to abide by”, which will have far-reaching implications for companies like Circle, PayPal, and JPMorgan that are promoting stablecoin businesses.

For this reason, as the only stablecoin issuer currently listed on the US stock market, Circle has risen sharply since its IPO on June 5, soaring from an issue price of $31 to a high of $263.45, an increase of over 100%, placing it among heavyweight players like Coinbase and Robinhood.

It is worth noting that Circle’s market capitalization once approached $60 billion, equivalent to the total circulating market value of the USDC it issued, which undoubtedly marks the beginning of a revaluation of the market’s pricing logic for compliant stablecoins.

This also indicates that the imagination of “stablecoin compliance” is no longer limited to Web3, but begins to project into mainstream financial narratives. Regardless of the actual direction it takes in the future, it represents a turning point for crypto assets to further enter mainstream visibility and gain a legal compliance framework.

02 Hong Kong: Leading in Licensing, Accelerating Implementation

Since the release of the “Policy Declaration on the Development of Virtual Assets in Hong Kong” on October 31, 2022, Hong Kong has been at the forefront of the global major jurisdictions in the field of cryptocurrency regulation.

As early as January 2022, the Hong Kong Monetary Authority released a discussion paper on crypto assets and stablecoins and invited stakeholders to provide feedback. At the beginning of last year, it even launched a “sandbox” for stablecoin issuers to understand the business models of institutions planning to issue fiat stablecoins in Hong Kong.

The latest Hong Kong “Stablecoin Regulation” will take effect on August 1, at which point the Hong Kong Monetary Authority will begin accepting license applications. Currently, the Hong Kong Monetary Authority has initiated market consultation on the implementation of specific guidelines for the “Stablecoin Regulation.”

Source: Hong Kong Monetary Authority

According to the currently disclosed information, the key system design adheres to the principle of “same activities, same risks, same regulation”, including that issuers need to apply for a stablecoin issuance license from the Monetary Authority, must have a locally registered entity, and the assets must be fully linked to the total issuance, with reserve assets being highly liquid fiat currency or short-term government bonds.

It can be said that the regulatory dimensions and mechanisms related to the United States mentioned above are largely similar. It is worth noting that the Hong Kong regulatory system applies to stablecoins pegged to major currencies such as USD and HKD. The core policy aims to provide a stable clearing and settlement medium for Web3 finance while attracting more institutions to establish stablecoin businesses in Hong Kong.

As an international financial center, Hong Kong has always been actively exploring paths for financial innovation. The stablecoin market is, to some extent, a comfort zone for Hong Kong as an international financial giant—encompassing a rich variety of financial services, with years of accumulation and rich experience, a mature risk control system, complete trading infrastructure, and a large customer base.

This also emphasizes flexibility in implementation and alignment with international standards compared to the United States, attracting more institutions to use Hong Kong as a springboard to explore the clearing and issuance pathways of stablecoin in the Asian market. Currently, local heavyweight players such as HashKey and OSL are reportedly preparing or planning applications for stablecoin licenses, becoming an important entry point to observe the integration of cryptocurrency compliance and financial infrastructure in Hong Kong.

03 The EU, South Korea and other regions are flourishing.

In addition, the EU’s MiCA regulation (Markets in Crypto-Assets), which will take effect in 2024, comprehensively covers the compliance regulation of crypto assets and provides detailed classifications for stablecoins, including two main categories: EMT (Electronic Money Token) and ART (Asset-Referenced Token).

The former refers to stablecoins that are pegged to a single fiat currency, such as the EURC issued by Circle, while the latter refers to stablecoins pegged to a basket of assets, such as the failed Libra type. EMT stablecoins must obtain permission from the EU electronic money institution, be regulated by the central bank, disclose reserve composition and operational mechanisms, and ensure users’ redemption rights. Circle’s EURC is one of the first products to benefit from the implementation of MiCA.

At the same time, South Korea, which has a significant influence in the Crypto field, has proposed the “Basic Law on Digital Assets” by the ruling party of its new president, Lee Jae-myung, which clearly states that as long as a Korean company has a capital of at least 500 million won (approximately 370,000 USD) and ensures refunds through reserves, it can issue stablecoins.

Source: Cointelegraph

According to data from the Bank of Korea, the trading volume of stablecoins in South Korea surged, with transactions of major dollar stablecoins reaching 57 trillion won (approximately 42 billion dollars) in the first quarter across five major domestic exchanges (Upbit, Bithumb, Korbit, Coinone, and Gopax).

Recently, the Senior Deputy Governor of the Bank of Korea, Ryu Sang-dun, also stated that the introduction of stablecoins denominated in Korean Won should be gradual. Commercial banks, which are under the strictest regulation, should first issue Korean Won stablecoins, and after gaining experience, non-bank institutions can gradually be allowed to participate.

In addition, several major financial centers have historically issued local stablecoin frameworks or pilot projects:

• The Monetary Authority of Singapore (MAS) proposed a stablecoin regulatory draft in 2023, emphasizing 1:1 reserves, transparent disclosures, and local operating requirements;
• Abu Dhabi Global Market (ADGM) launches a stablecoin clearing and settlement pilot, attracting cross-border businesses such as PayPal and USDC;
• Japan allows banks and trust companies to issue stablecoins through new legislation;

Overall, European regulation focuses on protecting user rights and financial stability, while South Korea tends to collaborate with local financial and tech giants to explore. This not only signifies that the global stablecoin regulatory framework is gradually moving towards a unified standard, but also indicates that stablecoins are no longer in a gray area and are being regarded as a formal component of financial innovation. Their regulatory sandbox has also become an important capital policy tool to attract Web3 projects.

Looking dialectically, starting in 2025, whether it is cryptocurrency asset ETFs or stablecoins, a brand new regulatory cycle has become a significant watershed in the development of Web3 and the cryptocurrency industry. Especially as compliance becomes the main line of the next stage of development for stablecoins, the exploration of various countries at the institutional level not only affects the market landscape but also profoundly shapes the future infrastructure of Web3 finance.

It can be said that, looking globally, stablecoins are undergoing a dramatic transformation from “grassroots expansion” to “institutional dominance,” and the reconfiguration of the landscape brought about by this major change is unfolding as regulations from various countries are being implemented.