Hong Kong's New Stablecoin Regulations Aim to Prevent Fraud

According to Odaily, Hong Kong Monetary Authority Chief Executive Eddie Yue has issued a warning about recent scams involving the promotion of digital assets and stablecoins, which have resulted in financial losses for the public. The 'Stablecoin Ordinance' came into effect on August 1, making it illegal to promote any unlicensed stablecoins to the Hong Kong public. Yue highlighted that central banks and financial regulators worldwide are increasingly focused on preventing stablecoins from being used for money laundering, especially in cross-border transactions. The Bank for International Settlements emphasized the importance of mitigating money laundering risks associated with stablecoins in its latest annual economic report. Yue believes that a balanced approach to regulation is crucial, as the regulated stablecoin industry is still in its early stages. He advocates for a strict initial regulatory framework that can be gradually relaxed based on practical experience, which he argues is more beneficial for the sustainable development of the market and issuing institutions than starting with lenient regulations and later addressing resulting issues.