Circle Confirms No Plans for Hong Kong Dollar Stablecoin While Exploring Local Partnerships

Circle Rules Out Hong Kong Dollar Stablecoin While Eyeing Strategic Partnerships

Circle, the issuer of the US dollar stablecoin USDC, has confirmed it has no immediate plans to launch a Hong Kong dollar-pegged stablecoin, even as interest in local currency tokens surges following Hong Kong’s new Stablecoin Ordinance.

Chan Yam Ki, Vice President for Asia Pacific at Circle, stated in an interview with the Hong Kong Economic Times that the company is currently focused on expanding its USDC and euro-backed EURC tokens.

How Can USDC Be Used in Hong Kong Without Extra Rules

Under the current legal framework, institutional investors in Hong Kong can access USDC without additional regulatory requirements under the Stablecoin Ordinance.

Chan said,

“USDC can be used under the current legal framework without additional Stablecoin Ordinance requirements.”

Retail investors, however, must obtain USDC through Circle’s licensed partners.

Circle holds a major payment institution license in Singapore and operates in multiple jurisdictions worldwide.

Although not directly regulated in Japan, USDC became the first stablecoin that Japanese regulators allowed licensed institutions to offer publicly, accessible to both retail and professional investors through approved partners.

Why Circle Prefers Strengthening USDC and EURC Before New Launches

USDC remains the second-largest stablecoin by market capitalisation, valued at $75.28 billion, trailing only Tether’s USDT.

Despite this, USDC’s daily growth rate of 0.41% surpasses USDT’s 0.06%.

Circle also dominates the euro-backed stablecoin market with EURC, which holds a market cap of $266.5 million, accounting for over 45% of the total $570 million euro-pegged stablecoin market.

EURC trails the ruble-backed A7A5, which leads non-USD stablecoins by over 40%.

Chan noted that EURC would need an additional $213 million in market capitalisation to overtake A7A5.

Is Circle Open to Collaborating on HKD Stablecoins

Although no Hong Kong dollar stablecoin is on the immediate roadmap, Chan emphasised that the company is open to partnerships with local firms.

He explained,

“We are not launching a HKD-backed stablecoin, but we are exploring partnership opportunities.”

Discussions with several companies are already underway, with collaboration envisioned similarly to how banks operate across different jurisdictions, using local currencies while referencing the US dollar.

What Circle’s Asia Expansion Looks Like

CEO Jeremy Allaire previously mentioned plans to hire staff and establish a branch in Hong Kong.

Chan confirmed that the company has not yet opened an office and is still evaluating potential locations.

He declined to comment on any specific steps regarding license applications under the new Stablecoin Ordinance but indicated ongoing engagement with regulators, policymakers, and businesses to monitor developments and discuss feasible business operations in the region.

How Circle Is Preparing for Multi-Currency Stablecoins

Chan highlighted the growing demand for stablecoins denominated in currencies beyond the US dollar, which currently represents 98% of the market.

He pointed to Circle’s blockchain project, Arc, designed to support cross-jurisdictional trading of stablecoins, including built-in foreign exchange functionality.

Large financial institutions have expressed interest in opt-in privacy features and on-chain currency exchange, suggesting Circle is laying the groundwork to launch additional stablecoins in multiple currencies as demand grows.

Why US Dollar Remains Central Despite Global Expansion

Chan noted that not all stablecoins are regulated equally and that US dollars still dominate global trade, especially in Asia, where 75% of transactions use the currency.

He said,

“Global demand for the US dollar is enormous. Businesses need to use US dollars to buy and sell goods around the world.”

Circle’s strategy reflects a cautious expansion approach, prioritising the growth and adoption of its existing USDC and EURC tokens while remaining open to future collaborations and multi-currency opportunities.