FTAHK Summary Response to HKMA Cryptoasset & Stablecoin Discussion Paper


Our response outlined the industry’s support for providing a regulatory framework that provides market participants with assurance, transparency, and regulatory clarity.

FTAHK in principle is very supportive of HKMA’s proposed risk-based approach to regulating payment-related stablecoins

FTAHK has over 1100 members representing 300+ firms and is the largest FinTech association in Hong Kong.
As such, FTAHK continues to be supportive of the growth of Hong Kong as a fintech and virtual asset hub, and recently submitted our responses to Hong Kong Monetary Authority (“HKMA”)’s Discussion Paper on Cryptoassets & Stablecoins.

In our response, we shared that we are in principle very supportive of the HKMA’s proposed risk-based approach to regulating payment-related stablecoins, and recommend that the HKMA adopt a “substance (or function) over form” approach when considering whether such stablecoins should be regulated under existing or equivalent licensing regimes (eg, as a stored value facility (“SVF”), a deposit-taking bank, a virtual asset service provider (“VASP”), or under any other relevant licensing regime).

We also recommend that the HKMA’s proposed regime regulates “primary activities (i.e., the issuance, creation, or destruction of payment-related stablecoins, or activities that are linked to the management of stabilization activities in relation to stablecoin value) rather than “secondary activities”.

We also welcome the HKMA to continue to work alongside international and local regulators and standard-setting bodies to create a coordinated regulatory regime that is consistent with global standards in terms of minimum requirements to avoid overlap and confusion and prevent regulatory arbitrage while protecting stablecoin users and financial stability.


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