Hong Kong and the United States aim to regulate stablecoins by 2024

The Hong Kong Monetary Authority has completed a Public consultation on the regulation of stablecoins with the aim of providing clear regulatory guidance in the stablecoin market by the end of 2024.

Joseph Chan Ho Lim, Deputy Director of the Hong Kong Office of Financial Services and Treasury, said that Hong Kong has emerged as a growing destination for financial technology companies over the past five years. Chan added that the Hong Kong authorities are Actively involved in promoting the Web3 ecosystemwith a particular focus on investor protection.

Hong Kong began regulating stablecoins in January 2022, when the KHMA shared a list of eight inquiries for policy recommendations, citing five possible regulatory outcomes: no action, opt-out regime, risk-based regime, public order, and generalized ban. A year later, the regulatory discussions It strictly prohibited the inclusion of stable algorithms after the Earth-Moon catastrophe.

With the completion of the public consultation phase, the Capital Markets Authority will focus on the areas of issuance, governance and stability.

Hong Kong has taken the lead in regulating cryptocurrencies this year, at a time when most of its Western peers are still taking a cautious approach to the emerging technology. HKMA has not only opened up cryptocurrency trading to retail traders, but also cryptocurrency Launched a licensing system for exchangesThese companies are required to adhere to strict anti-money laundering rules.

In addition to Hong Kong, the US House Committee is also trying to introduce strong regulation of the stablecoin market. The US House of Representatives committee has introduced three stablecoin bonds in 2023, the latest of which proposes key powers for the Federal Reserve with some intervention powers for state powers.

The approach of the two countries’ local regulators could not be more different. On the one hand, Hong Kong regulators are actively pursuing the goal of making the country a cryptocurrency hub, while the actions of the US regulators It could force many existing companies out of the country, including stablecoin issuers. The US Securities and Exchange Commission has accused several stablecoin issuers of violating securities law, suing Binance and its stablecoin BUSD, Issued by Paxos.
Translated by Walter Rizzo

Halbert Gray

Halbert Gray writes for Hardwood Paroxysm, covering news, politics, business, technology, sport, entertainment, and lifestyle. He focuses on clear reporting, current affairs, and stories that matter to readers, providing reliable information in an accessible and engaging way.