Hong Kong will continue prohibiting retail investors from trading stablecoins until the assets are officially regulated, according to remarks from Hong Kong Secretary for Financial Services and the Treasury, Christian Hui. Regulations are projected to be implemented by end of 2024.
In a recent online meeting, Secretary Hui noted Hong Kong has yet to adopt specific regulations around stablecoins such as Tether (USDT) or USD Coin (USDC). Without formal rules in place, retail stablecoin trading is not permitted.
The Secretary cited stability concerns with some stablecoins as a key factor driving the regulatory approach. Hui pointed to reserve management practices that have led to volatility and collapse for certain stablecoins.
Hong Kong allowed retail crypto trading of assets like Bitcoin in August 2022. However, stablecoin trading by individual investors will remain restricted until the completion of their regulatory framework, expected by end of next year.
The remarks come after major stablecoin-related scandals in Hong Kong this year, including the JPEX exchange crisis which prompted fraud investigations. Hui stated the JPEX case highlights the urgent need for tighter crypto market supervision.
#HongKong #stablecoins #cryptocurrency #regulation #trading
