Governments and major corporations around the world are rushing to invest in stablecoins, with Hong Kong poised to lead the way
By Belmont NewsBeat
On 21 May 2025, the Legislative Council of Hong Kong has passed the Stablecoins Bill with the Stablecoins Ordinance confirmed to take effect on 1 August 2025. Almost immediately after that, the US Senate also passed the Stablecoin GENIUS Act. In 2025, many countries are currently introducing legislation specifically focused on stablecoins.
Even Pan Gongsheng, Governor of the People’s Bank of China, publicly discussed stablecoins for the first time this June — a notable shift in tone. Meanwhile, there is a wave of Fortune 500 firms launching crypto tokens of their own.
Back in 2021, during the previous Bitcoin frenzy, few professionals working in digital assets could have imagined stablecoins would take off like this.
Despite these developments, many still think the crypto world is just a way to make a quick buck — but if that’s the case, why are governments around the world and major corporations rushing to invest in stablecoins?
From niche to necessity
To understand why stablecoins matter, one must first appreciate what they represent. These are digital tokens designed to mirror the value of traditional currencies — such as the USD or CNY — but issued on blockchain networks. Unlike volatile cryptocurrencies, stablecoins aim to maintain a steady price by pegging to fiat currencies, commodities, or financial instruments. The advantages of convenience and privacy make them useful as payments.
According to McKinsey, stablecoin transaction volume has risen sharply over the past two years, exceeding US$27 trillion per year — more than Visa and Mastercard combined in 2024. Their use cases now extend to e-commerce settlements, cross-border payments, and increasingly, sovereign monetary strategies.
Taking countries like Argentina and Brazil as examples: since 2022, people in these nations have been struggling with rapid currency depreciation. At the same time, their governments have imposed strict capital controls, making it incredibly difficult for individuals to access or transfer foreign currency. So, they turned to stablecoins.
At first, the response from governments was predictable: bans, crackdowns, and restrictions. But the demand from the public was overwhelming, and enforcement proved nearly impossible. Facing the reality that stablecoins weren’t going away, many of these governments made a dramatic pivot — from resistance to active support, becoming unlikely champions of stablecoin adoption.
At the same time, authorities are concerned about the widespread use of stablecoins and its potential impact on monetary policy and sovereignty, financial stability, consumer protection, cybersecurity, anti-money laundering and counter-terrorism financing compliance. Therefore, implementing appropriate regulation is essential.
Hong Kong’s bet on the future of money
For Hong Kong, the stablecoin opportunity is a chance to reassert its relevance at a time when global financial centres are competing not just on capital markets or IPO pipelines, but on who will shape the next generation of money.
Hong Kong’s approach differs. Unlike most jurisdictions where stablecoins remain dollar-dominated, Hong Kong is encouraging issuance in HKD and CNH, aligning with mainland monetary strategy and giving the city geopolitical significance in digital currency infrastructure. Tech giants JD.com and Ant Group are already lobbying to issue Renminbi-linked tokens. According to Reuters, this is to counter the growing sway of USD-linked cryptocurrencies.
Instead of opening the floodgates, Hong Kong has implemented sandbox-driven access, ensuring that only serious, well-capitalised players can enter while allowing regulators to monitor real-world experimentation in a controlled environment. Back in July 2024, the Hong Kong Monetary Authority (HKMA) officially announced the first three participants in the sandbox program. The licenses went to JD Coinlink, clearly backed by Chinese tech giant JD.com; RD InnoTech, primarily backed by crypto-native capital and an alliance of Standard Chartered Bank, Animoca Brands, Hong Kong Telecommunications.
Fierce competition
While these three made the initial cut, other heavyweight contenders are already eyeing the next round. Notably, Ant Group has long made its ambitions clear and will seek stablecoin licences. The competition for stablecoin licenses is fierce. It’s a signal that major tech and financial players see this as a meaningful new frontier.
Hong Kong isn’t stopping at domestic use cases. One of its strongest plays lies in cross-border payment innovation. The city is uniquely positioned to serve as a financial bridge between mainland China and global markets.
In June 2025, the HKMA and the People’s Bank of China jointly launched a new Cross-Border Payment Connect, designed to enable direct point-to-point connections between Hong Kong and the mainland. It dramatically simplifies fund transfers without the need for complex clearing steps, smoothing the flow of capital across borders. Though the system isn’t blockchain-native, it is built using distributed ledger technology, making it highly compatible with stablecoins and digital yuan infrastructure. Many in the market view that a future ‘stablecoins and cross-border payment connect’ is poised to become a core engine of international capital flows.
Taken together, Hong Kong’s sandbox pilots and cross-border infrastructure show a city not just following the stablecoin trend, but shaping it to fit its strategic strengths. If Singapore is racing ahead with clear digital asset rules, Hong Kong is betting on currency innovation, cross-border integration, and proximity to China as competitive edges.
Stablecoins are no longer a crypto story. They are a currency story.