Hong Kong Pivots to Yuan as Stablecoin Progress Slows
Hong Kong is prioritizing the offshore yuan over stablecoins, according to a recent government briefing. Offshore yuan lending hit a record 935 billion yuan by the end of 2025, while the Hong Kong Monetary Authority (HKMA) expanded its liquidity facility to 500 billion yuan and extended credit tenors to three years. Only two stablecoin licenses were granted under the Stablecoins Ordinance, to HSBC and Anchorpoint Financial, with limited trading options available.
During a Legislative Council briefing, Christopher Hui, Secretary for Financial Services and the Treasury, outlined a financial agenda focused on the offshore yuan. The HKMA is enhancing liquidity mechanisms and reviewing short-term debt instruments to support renminbi interest rate calibration. The region's bond issuance reached 1 trillion yuan for the second straight year in 2025, aligning with the 2026-2030 Five-Year Plan.
Hui assured lawmakers that public spending will continue in Hong Kong dollars, dismissing any shift toward a yuan peg or floating exchange rate. The stablecoin segment faces regulatory bottlenecks, with only HSBC and Anchorpoint Financial securing licenses. HSBC's stablecoin, HSBC RedCoin, will debut in its PayMe wallet, while Anchorpoint Financial's HKDAP token is restricted to professional investors.
Beijing's ban on unauthorized yuan-pegged stablecoins and the upcoming amendment bill for virtual asset platforms highlight ongoing regulatory challenges. The government plans to introduce a comprehensive licensing framework for custody, advisory, management, and trading services by the end of 2026.