Hong Kong’s Legislative Council today approved a bill requiring stubcoin issuers to obtain licenses from the Local Monetary Authority (HKMA). The decision occurred in the third reading given to him by lawmakers.
According to a report issued by the Bill Committee, the initiative is trying to mitigate financial risks. A clear provision as to who must obtain a license. This is considered a regulated stub coincriteria for granting licenses, non-integrated sanctions, and research and execution authority granted to central banks.
Among other aspects is the Hong Kong Monetary Authority (HKMA) During the development of commercial activities, we will adopt an essential approach to assess whether a specified stability will be broadcast in Hong Kongtaking into account aspects such as the issuer’s activities, its legal residence, the stubcoin issuance process, the management of reserve assets, and the location of the bank account used to process cash flows.
Stubcoin emitters aimed at maintaining stable value linked to local currency, Hong Kong (HKD) dollars, either within or outside the territory; They must meet the requirements for money laundering prevention and terrorist financing. They also need to demonstrate transparency, auditing, and aptitude and good conduct.
According to the Hong Kong government, the law will come into effect this year and confirm that it will “give enough industries to understand the requirements of the licensing system.” And the monetary authority has indicated that future consultations will be held to define the regulatory framework in greater detail.
“A practical regulatory regime, flexible, risk-based regulations have been created,” said Eddie Yue, executive director of the Hong Kong financial authorities. He pointed it out A robust regulatory environment provides favorable conditions for sturdy responsibility and promoting sustainable development Digital asset ecosystem.
On his part, Christopher Hui, secretary to the Ministry of Financial Services, said, “The law not only complies with international regulatory standards, but also establishes a solid foundation for Hong Kong’s virtual asset market.” According to Hui, this “encourages the sustainable development of the industry, protects user rights and interests, and strengthens the territory’s status as an international financial centre.”
This initiative in Hong Kong is not an isolated case, and is not the first time the territories have made progress in regulating cryptocurrency against other great economies such as the United States. In fact, last year he approved the launch of ETFs to cash in ETFs before the existence of American power.
As reported by Cryptootics, Unlike continental China, Hong Kong maintains a legal framework that enables and encourages the development of cryptographic actionsserves as a laboratory for the implementation of new monetary policies.
Ether cash in ETFs, as happened with approval for Ethereum cryptocurrency, This new law in Hong Kong could impact the US and promote the country to accelerate approval of the Genius Actits own legislative project to regulate stubcoins. This reflects the need to remain competitive in global markets where other regions are already integrating leadership in financial innovation.
Johnny NG, a member of Hong Kong’s Legislative Council, believes that approval of the law in Hong Kong is essential for the region to strengthen as an innovation leader, as the following message published in X shows:
What is the state of genius law?
After a fierce debate in the Senate, the Genius Bill was achieved this week to overcome the motion of the proceedings The majority of the 66 votes voted in favor, 32 votes. This unprecedented consensus in the American political framework on the regulation of digital assets is held by the industry as a key advance that can mark before and after the adoption of cryptographic actions.
The next step in the project is to move on to the final voting for the Senate. If the required majority can be obtained at this stage, the initiative will be passed to the House for review and final approval. Once both Congressional cameras grant approval, the proposal is sent to the President of the United States for its signature, and at that time it becomes law.
Genius Law seeks to establish a regulatory framework that provides clarity, security and trust that has been lacking in recent years in the US Stablecoins sector, particularly amidst long-term conflicts with organizations such as the SEC.
Such proposals argue that stubcoin emitters and assets above 100 million US dollars under direct supervision of the Federal Reserve, while smaller emitters are subject to state regulations. Additionally, strict transparency is required through monthly audit reports on property reserves, with criminal sanctions against those who present false information.
Currently, the global Stablecoins market represents USD 248,000 million, and the assets leading the majority of this sector are Tether (USDT), which follows the price of US dollars. The currency’s capital is USD 152,000 million.