Hong Kong stablecoin "Ming Qiang": From licensing to ecosystem, the real marathon has just begun

Author: Farmer Frank

On April 10, 2026, the Hong Kong Monetary Authority officially granted the first batch of stablecoin issuer licenses to Anchor Financial Technology Limited and Hongkong and Shanghai Banking Corporation Limited. With this, Hong Kong has become one of the first financial centers in the world to complete the full institutional loop of "legislation - review - licensing," which also means that stablecoin regulation has officially progressed from policy design to licensed operation.

Amidst the overwhelming news, many people have noticed a thought-provoking signal: among the first batch of licensed entities, one is independently licensed by HSBC, while the other, Anchor Financial, is backed by a joint venture of Standard Chartered Bank (Hong Kong), Hong Kong Telecommunications, and Animoca Brands.

In other words, among the first entrants, HSBC and Standard Chartered are already two of the three major note-issuing banks in Hong Kong.

What does this mean?

1. From "Note-Issuing Banks" to "Stablecoin Issuers"

To be pragmatic, it is not surprising that the first licenses were awarded to HSBC and Standard Chartered, but the policy signals released behind this choice are worth careful interpretation.

This requires returning to Hong Kong's uniquely special currency issuance system. As is well known, Hong Kong's current paper currency system is primarily managed by commercial banks. Except for the 10 Hong Kong dollar notes issued directly by the Hong Kong government (Monetary Authority), the 20, 50, 100, 500, and 1000 Hong Kong dollar notes are issued by three note-issuing banks: HSBC, Standard Chartered, and Bank of China (Hong Kong).

In other words, regarding currency and financial infrastructure, Hong Kong has long accepted a very clear institutional arrangement: the front-end issuance function is undertaken by highly regulated commercial institutions, while regulatory authorities control the stability of the system through rules, reserves, and prudential requirements.

Viewed within this framework, the priority given to HSBC and the joint venture led by Standard Chartered for the first batch of stablecoin licenses essentially continues the idea of "starting with the most stable entities," which is in line with Hong Kong's own monetary tradition.

For a newly institutionalized category, seeking stability, controllability, and avoiding mistakes in the first batch of licensing is a very normal path choice for financial regulation.

This is not difficult to understand.

Although stablecoins are cloaked in the guise of "virtual assets," once they enter the institutionalized stage, regulators first look at the most traditional and financial issues: Are the reserve assets real? Is the redemption mechanism clear? Is the risk isolation sufficient? Is the flow of funds controllable? Are the anti-money laundering and traceability mechanisms reliable?

However, following this logic, another question naturally arises: Why is Bank of China (Hong Kong) absent among the three major note-issuing banks?

This matter is clearly not just a simple issue of qualifications or capabilities. In fact, Bank of China (Hong Kong) was widely regarded as an active participant in the first batch of applications from August to September 2025, until October 2025, when a joint statement from the central level further clarified the policy boundaries, imposing stronger constraints on private stablecoins, especially those pegged to the Renminbi. Some Chinese-funded institutions that originally planned to participate (including Bank of China (Hong Kong), Bank of Communications (Hong Kong), China Construction Bank (Asia), as well as large internet companies like Ant Group and JD.com) subsequently shelved their related plans.

This also means that the licenses ultimately granted to the two note-issuing banks represent both Hong Kong's insistence on stability at the initial stage and a realistic answer in the current cross-border policy environment. Whether Hong Kong's stablecoins can go far ultimately depends on who can truly expand this system in the next phase.

And this is precisely the aspect that many discussions tend to overlook.

2. Compliance is Important, but "License" ≠ "Ecosystem"

When analyzing the prospects of Hong Kong's stablecoins, an unavoidable reference point is the development history of virtual banks in Hong Kong.

In 2019, the Monetary Authority issued virtual bank licenses to eight institutions, and at that time, market expectations were high. Many believed that the new licensing system would automatically foster a new competitive landscape and new financial experiences. By 2024, the Monetary Authority released a review report, indicating that the market's overall response to the products and services offered by the eight virtual banks was ideal, but it also clearly stated that the current number of virtual bank licenses was appropriate and that no new licenses would be issued temporarily.

This is a very typical reference case. Looking back, virtual banks certainly have had achievements, but licenses did not automatically translate into market dominance, nor did they automatically convert into sustainable business models. This reveals a real issue: in a financial system that already has mature profit pools, mature customer relationships, and mature clearing channels, there is often a long way to go between institutional openness and market connectivity.

In simple terms, licenses can solve the access issue but cannot resolve user habits, scenario coverage, business efficiency, and network effects.

Stablecoins are no different, and the difficulty will only be higher.

After all, unlike virtual banks, stablecoins must not only compete with the traditional financial system but also engage in a game with established players like USDT and USDC, which are already deeply embedded in exchanges, on-chain protocols, and wallet systems.

Ultimately, it is not enough to obtain a license to automatically gain market presence; the license only resolves the issue of being allowed and trusted to issue stablecoins, but it does not solve several other more challenging questions: Why would users want to use your stablecoin? Why would trading platforms, wallets, merchants, market makers, and corporate financial systems be willing to accept your stablecoin? Why would funds be willing to stay, circulate, and settle within your system, ultimately forming network effects?

In other words, issuance is a qualification on the supply side, while the ecosystem is the answer on the demand side.

From the perspective of market competition, the real test begins at the moment of licensing because the competitive chain of stablecoins includes at least five links:

• Issuance, which addresses "Is there any?"
• Distribution, which addresses "Does it reach the users?"
• Liquidity, which addresses "Can it move in and out with low friction?"
• Scenarios, which address "What else can be done besides holding?"
• Operations, which address "How to ensure compliance, clearing, risk control, identity verification, and user experience run stably in the long term?"

And among these five links, issuance is just the first.

This is also why external criticisms about "Hong Kong's stablecoins cannot only have licenses" should not be simply understood as pessimism; on the contrary, such criticisms point out the real homework that Hong Kong's stablecoins must complete in the next phase—after licensing, if there is not enough strong distribution capability, liquidity organization capability, and scenario integration capability, Hong Kong's stablecoins are likely to remain correct at the institutional level but struggle to achieve success at the commercial level.

Today's global stablecoin market is no longer one where compliance labels alone can win users; user habits, scenario entry points, transaction depth, clearing and settlement efficiency, wallet integration, fiat currency inflow and outflow capabilities, and developer interfaces are the key variables that determine whether a stablecoin can truly thrive.

From the development paths of overseas markets, this shift in focus has become very evident.

After completing its acquisition of Bridge, Stripe no longer views stablecoins merely as a marginal payment capability but further integrates them into corporate fund management and global payment systems. For instance, the Stablecoin Financial Accounts launched in 2025 for businesses in 101 countries, followed by the Open Issuance powered by Bridge, are attempts to upgrade stablecoins from a supported alternative asset to a "payment capability that can be embedded in corporate financial systems."

Circle's actions are similarly representative. Recently, Circle has been pushing USDC further towards a more "programmatic payment" direction: on one hand, it publicly promotes self-payment based on x402, allowing AI agents to use USDC for automatic payment APIs, computing power, data, and content; on the other hand, it is also advancing the standardization of very small, machine-to-machine payments.

This indicates that in the eyes of the most astute players in payment infrastructure, the focus of stablecoin competition is no longer just about issuance qualifications but about who can make it a callable, settleable, and manageable financial foundation for enterprises.

Hong Kong has also had relevant practices. As early as the eve of the official implementation of the Hong Kong "Stablecoin Ordinance" last year, the licensed OSL Group launched three new products aimed at institutions: the compliant stablecoin management platform StableX, asset tokenization service Tokenworks, and enterprise-level crypto payment solution OSL BizPay. In 2026, it also launched a compliant US dollar stablecoin USDGO that meets U.S. federal regulations and can be distributed compliantly in Hong Kong, primarily focusing on cross-border e-commerce, bulk trade, and interactive entertainment.

In this context, looking at Hong Kong reveals a more critical question: the first batch of licenses addresses "who can enter safely first," but whether Hong Kong can form a truly competitive stablecoin ecosystem is determined by "who can fill in the remaining four tasks."

3. Issuance is Not the Endgame; Ecosystem Builders are Key

From the structure of the global stablecoin market, the pattern of ecological division of labor has become increasingly clear.

The most notable feature is the high concentration on the issuance side. For example, USDT and USDC together account for over 86% of the total market value of stablecoins, but the scale advantage of issuers does not naturally equate to ecological control. The real competitiveness of stablecoins often does not solely depend on issuance scale but rather on liquidity depth, channel coverage, and scenario penetration.

For instance, while USDC's market value is only 42% of USDT's, its on-chain transfer volume, institutional payment scenarios, and developer ecosystem activity are significantly higher. This is due to the effectiveness of distribution networks and scenario integration capabilities, rather than merely the issuance volume; and the legal issuer of PYUSD is Paxos, but its expansion is truly driven by PayPal's account distribution capability.

This illustrates that issuers and ecosystem builders of stablecoins represent two different combinations of capabilities:

• Issuers are responsible for reserve management, compliance risk control, and redemption mechanisms, which are the core tasks of the "issuance layer";
• Ecosystem builders are responsible for distribution channels, liquidity aggregation, scenario access, and business operations, which are the core tasks of the "application layer."

The two are not mutually exclusive but rather a collaborative relationship between upstream and downstream.

If we compare the stablecoin ecosystem to a building, then obtaining a license is merely acquiring the foundation construction permit. What truly determines how high the building can be is the load-bearing structure of each subsequent layer, and distribution channels, transaction liquidity, payment networks, scenario access, and compliance operation capabilities are precisely part of these load-bearing structures.

Therefore, the real test facing Hong Kong's stablecoins may never have been "who can obtain a license," but rather "after obtaining a license, who can truly utilize it."

This is why the next phase for Hong Kong's stablecoins may not just be about new issuers, but rather those capable of supporting distribution, transactions, payments, liquidity, and compliance operations as ecosystem platforms.

In fact, even the first batch of licensed institutions themselves have already demonstrated this point through their actions. Reports indicate that Anchor Financial plans to collaborate with selected enterprises as distribution partners to offer its stablecoin to the public; HSBC is preparing to reach users through the PayMe and HSBC HK Mobile Banking apps.

In other words, even for the first issuers to obtain licenses, their initial response after landing is not "I can finally issue coins," but rather "How should I distribute?" This itself indicates that stablecoins are not a business that can be completed solely by issuers, but rather a system engineering project that must rely on multi-layered ecological collaboration.

In this sense, what is truly scarce in the next phase for Hong Kong is not just new issuers, but ecosystem platforms that can support distribution, transactions, payments, liquidity, and compliance operations.

This is also the most noteworthy position in this round of discussions—comprehensive capability platforms that can connect the issuance side, circulation side, and usage side may truly determine the height of Hong Kong's stablecoin ecosystem.

The aforementioned Hong Kong-based licensed player OSL has already clearly stated its intention to actively collaborate with Hong Kong licensed stablecoin issuers, leveraging its advantages in distribution, liquidity, and infrastructure to promote the landing of related products and application scenarios. This statement indicates that it is more proactively positioning itself to lay the "capillaries" for this stablecoin network.

Objectively speaking, for a market that has just started and inherently requires multi-party collaboration, the scarcity of such roles may not be lower than that of the issuance license itself.

In fact, this is the key variable that determines whether Hong Kong's stablecoins can secure a place in global competition.

In Conclusion

Returning to a more macro perspective, the situation facing Hong Kong's stablecoins today is indeed challenging.

Looking inward to the mainland, policy stances will not loosen in the short term; looking outward, the barriers of user habits and network effects are already quite high. In this context, if Hong Kong's stablecoin ecosystem only remains at the level of "licensing - issuance - compliance," it may very well repeat the fate of virtual banks—the system is well-designed, and the data is acceptable, but a larger ecosystem fails to emerge.

However, conversely, this also precisely represents Hong Kong's opportunity window.

The global stablecoin market is undergoing a profound paradigm shift; stablecoins are no longer merely transaction mediums within the crypto market but are being redefined as the infrastructure for the next generation of global payments and settlements. In this new paradigm, compliance capability is no longer the only competitive dimension; distribution networks, payment scenarios, technological infrastructure, and ecological operation capabilities have become equally, if not more, critical.

As an international financial center, Hong Kong inherently possesses advantages in institutional design and compliance governance, but to truly transform this advantage into competitive strength for the stablecoin ecosystem, merely relying on the first batch of licenses is clearly insufficient. It also requires payment companies, technology platforms, compliance middleware, Web3 native enterprises, and local licensed institutions to layer by layer activate the more challenging and realistic tasks of distribution, liquidity, scenarios, and operations.

The road after licensing is still long, and the real competition for Hong Kong's stablecoins has only just begun.