Tech giants’ plans to issue stablecoins in Hong Kong are reportedly on hold, as Chinese authorities instructed them not to proceed with such initiatives, fearing they might undermine state control over financial industry.
Chinese regulators, including the People’s Bank of China (PBOC) and the Cyberspace Administration of China (CAC), have instructed major local technology firms such as Ant Group (backed by Alibaba Group) and JD.com not to proceed with plans to issue stablecoins in Hong Kong.
According to the Financial Times, the main concern is that allowing private-sector companies, including tech firms and brokerages, to issue any form of currency could give them too much control over the financial operations.
In Hong Kong, the regulatory environment around blockchain-based digital assets is evolving. Crypto and other similar tokens are recognized as “virtual assets” (VAs) but not legal tender. Under Hong Kong law, stablecoins are a subset of VAs and are now explicitly regulated via the new licensing regime.
This May, in Hong Kong, the legislators passed a “stablecoin bill” that establishes a licensing framework for fiat-pegged digital currencies. Under that law, any person or entity that issues a stablecoin in Hong Kong, or issues a stablecoin backed by the Hong Kong dollar, even if issued elsewhere, must obtain a licence from the Hong Kong Monetary Authority (HKMA).
That law took effect on August 1, 2025. It includes fairly strict rules: unlicensed issuance or promotion of fiat-referenced stablecoins exposed to Hong Kong retail investors can lead to fines and even jail time. The HKMA also cautioned the market that only a handful of licences would likely be granted in the early stages. However, the potential rise of currencies controlled by the private sector apparently caused additional concerns among Beijing regulators.
In mainland China, the regulatory environment has been very strict for cryptocurrencies. In 2021, China declared all crypto-to-fiat exchanges and many crypto-related services illegal, effectively closing the domestic market for many crypto businesses.
At the same time, China is pushing ahead with its own state-issued digital currency, the digital yuan (e-CNY), which is centralized and controlled by the PBOC.
Ant Group, JD.com, PBOC, and CAC did not officially comment on the media reports.
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