Standard Chartered to Launch HK Dollar-backed Stablecoin
As Hong Kong strives to become an international Web3 hub under a compliant regulatory framework, Standard Chartered has launched a joint venture with HKT and Animoca Brands to establish a Hong Kong dollar-backed stablecoin to streamline transactions and enhance payment efficiency.
The joint venture has applied for a license from the Hong Kong Monetary Authority (HKMA) to issue the stablecoin.
Each participant in the joint venture has expressed its ambitions for the dollar-backed stablecoin, with Animoca Brands striving to explore crypto-native opportunities, Standard Chartered leveraging its bank-grade governance and infrastructure and HKT using its mobile wallet expertise to develop stablecoin use cases for cross-border and domestic payments.
This comes after recent research from Standard Charted highlights stablecoins process US$425bn monthly, indicating a failure in traditional payment systems to meet speed and cost targets.
Bill Winters, CEO of Standard Chartered, explains: “As public chain instruments with proven use cases, stablecoins play a critical role in the overall digital asset ecosystem.
“Standard Chartered’s bank-grade infrastructure, governance and global reach mean that we are in a good position to materially contribute to the development of the ecosystem being built in Hong Kong and globally.”
Hong Kong’s crypto hub push
Hong Kong continues to secure its position as an international cryptocurrency hub by supporting Web3 development, fostering innovation and implementing clear regulations.
The city’s government issued a proposed stablecoin bill in December that would provide a regulatory framework for issuances.
In July, the HKMA approved three stablecoin issuers to assess its usage in several situations - RD InnoTech, Jingdong Coinlink Technology and Standard Chartered joint venture.
Hong Kong’s Securities and Futures Commission (SFC) showcased its commitment to crafting a dynamic and secure digital asset ecosystem by permitting licenses to seven cryptocurrency exchanges by December 2024.
The Financial Services and the Treasury Bureau recently posted to its Facebook page explaining how the Hong Kong High Court has permitted the use of blockchain technology when serving a tokenised injunction focusing on two, fraud-related VA wallet addresses.
Hong Kong has also suggested tax exemptions on alternative assets for private equity funds, hedge funds and family offices and investment gains from cryptocurrencies.
Evan Auyang, Animoca Brand’s President, states: “This opportunity to become one of the first to issue a fiat-backed stablecoin under the HKMA’s licensing regime reinforces our conviction that Hong Kong has a bright future as a global Web3 hub, leading the charge to grow the industry in a safe and compliant manner.”
What impact will this stablecoin have?
The dollar-backed stablecoin will help to improve cross-border and domestic payments using HKT’s mobile wallet expertise and Animoca’s Web3 innovations.
This drive will help drive Hong Kong’s goal to become the international Web3 hub by encouraging real-world stablecoin use cases and crypto-native opportunities.
Not only will the stablecoin set a benchmark for compliance under Hong Kong’s dynamic virtual asset regulations but it will also offer faster and more secure transactions, streamlining cross-border remittances.
Susanna Hui, Group Managing Director, HKT, explains: “HKT is dedicated to leveraging technology to support our dynamic consumer and merchant ecosystem, aiding merchants in navigating the constantly evolving retail landscape.
"We believe that issuing an HKD-linked stablecoin will enhance payment efficiency, streamline transactions, and provide greater security and transparency through advanced Web3 innovations, ultimately benefiting the broader retail sector.
"As a leading technology solutions provider, we are delighted to join hands with our partners, bolstering Hong Kong’s businesses and reinforcing its status as a leading innovation hub.”
Explore the latest edition of FinTech Magazine and be part of the conversation at our global conference series, FinTech LIVE.
Discover all our upcoming events and secure your tickets today.
FinTech Magazine is a BizClik brand
