Hong Kong has announced the first group of participants in its stablecoin sandbox initiative, which includes leading organizations such as Standard Chartered Bank and Animoca Brands.
Hong Kong to Try Stablecoin with Standard Chartered Bank and Animoca Brands Among the First Participants
However, authorities stipulated that these participants would not be allowed to request public funds during the trial phase. The move is part of Hong Kong's broader goal to establish itself as a leading cryptocurrency hub.
In a statement, the Hong Kong Monetary Authority (HKMA), the territory's de facto central bank, detailed the trial's purpose of allowing institutions to test operational plans for stablecoin issuance. The aim was to develop a regulatory framework that was both appropriate and risk-based.
First announced in March, the virtual space will include Jindong Coinlink Technology, RD InnoTech, Standard Chartered Bank, Animoca Brands and Hong Kong Telecommunications in its first phase.
In a separate statement, the HKMA's deputy director general, Darryl Chan, stressed that virtual space participants should not raise funds from the public or offer investment products under the virtual domain name. “They cannot use the general public's funds in the first phase of their testing,” Chan said.
Use cases suggested by the first group of participants include applications in payments, supply chain management and capital markets.
Chan underlined the potential benefits of stablecoins, drawing attention to their ability to reduce costs, reduce transaction times and provide innovative solutions thanks to their programmability.
“They will produce more automated and 'smarter' financial services, thereby streamlining fund flows and enabling better management of transaction-related risks,” he added.
*This is not investment advice.