Hong Kong Selects Three for Stablecoin Issuers Sandbox，China's top e-commerce company is one of them

The Hong Kong Monetary Authority (HKMA) has announced the first participants in its stablecoin issuer sandbox.

Following the conclusion of its consultation period on stablecoin regulations, the HKMA selected a company associated with a major Chinese e-commerce retailer, a local fintech firm, and a coalition of Standard Chartered Bank, Animoca Brands, and Hong Kong Telecommunications.

The selected participants' Assessment and Regulations

The selected participants will undergo a thorough assessment process.

They will test their operational plans and engage with regulators to refine the proposed regulatory framework. These participants are prohibited from handling or soliciting public funds for sandbox-related activities.

HKMA deputy CEO Darryl Chan highlighted the importance of proposing concrete use cases for stablecoins to address economic challenges and create new opportunities.

Animoca Brands’ Coalition

Hong Kong-based Animoca Brands, a Web3 software developer and venture capital firm, has teamed up with Standard Chartered Bank and Hong Kong Telecommunications.

This coalition aims to develop Hong Kong’s digital asset ecosystem and its real-world applications.

They will utilize Zodia Custody, a majority-owned service by Standard Chartered providing cold storage for digital assets, which launched in Hong Kong in October.

Local Tech Firms Join In

Jingdong Coinlink Technology Hong Kong, linked to the Chinese e-commerce giant JD.com, is another participant.

JD.com established its blockchain arm in 2018. RD InnoTech, a subsidiary of RD Technologies, also joined the sandbox.

RD InnoTech plans to test various use cases for its proprietary Hong Kong Dollar stablecoin, "HKDR," including digital asset trading and cross-border trade payments.

Regulatory Framework

The HKMA, alongside the Financial Services and the Treasury Bureau, released updated proposed regulations for stablecoin issuers on July 7.

These regulations aim to create a robust framework for stablecoin issuance and usage in Hong Kong.

Conclusion

The selection of these participants marks a significant step in Hong Kong's efforts to regulate and integrate stablecoins into its financial ecosystem.

By addressing economic pain points and exploring new opportunities, these initiatives aim to enhance the region's digital asset landscape.