The stablecoin market is迎来新一轮热潮

Recently, the stablecoin market has stirred up excitement again. There are reports that a large technology company is planning to apply for stablecoin licenses in Hong Kong and Singapore. The company responded by saying it is accelerating investment and expanding cooperation in global treasury management, putting its innovations in AI, blockchain, and stablecoin into large-scale application.

"We welcome the Hong Kong Legislative Council's passage of the Stablecoin Bill, and we hope to submit our application as soon as the bill takes effect on August 1, contributing more to building Hong Kong as a future international financial center," the company stated.

According to reports, the company's executives revealed that they have initiated the application for a stablecoin license in Hong Kong and have already conducted multiple rounds of communication with regulatory authorities.

This news has attracted market attention, leading to a significant increase in related concept stocks.

Characteristics and Regulation of Stablecoins

Stablecoins maintain price stability by being anchored to specific assets, making it easier to accumulate value trust. The Hong Kong Special Administrative Region government recently released the "Stablecoin Regulation," which clearly defines the concept of stablecoins and "designated stablecoins."

To ensure stability, multiple countries and regions have set strict requirements for the reserve assets of stablecoins. Hong Kong requires that the market value of reserve assets must equal the face value of unredeemed stablecoins, and these assets must be of high quality, high liquidity, and low risk. The United States, the European Union, Singapore, and other places also have similar regulations.

Industry insiders point out that the 1:1 reserve requirement is intended to ensure that stablecoins are backed by real assets, avoiding trust crises and the risk of runs. This is beneficial for enhancing the credibility and liquidity of stablecoins.

Finding Application Scenarios

Currently, the total scale of global stablecoins is about 230 billion USD, mainly dominated by USDT and USDC. To get a share, Hong Kong is accelerating the relevant processes, including launching a regulatory sandbox and passing legislation.

Experts believe that the development of stablecoins in Hong Kong is of great significance for enhancing its status as an international financial center. However, due to the obvious disadvantage in market share, the development prospects of the Hong Kong dollar stablecoin still need to be observed. The key lies in whether applicable scenarios can be found to expand the practical role of non-US dollar stablecoins.

Cross-border payments are seen as a potential breakthrough. Industry insiders say that stablecoins have timeliness and cost advantages in cross-border payments. However, bridging on-chain and off-chain cross-border transactions still requires long-term efforts and involves multiple challenges.

All parties actively layout

With the promising outlook for the stablecoin market, various parties are actively positioning themselves. In February of this year, several financial and technology companies reached agreements to apply for the issuance of Hong Kong dollar-pegged stablecoins.

Large technology companies are also entering the market. Some analysts believe that these companies, with their strong capital management capabilities and global financial technology backgrounds, have a first-mover advantage in the Hong Kong stablecoin market.

Participating in stablecoin issuance also involves considerations of asset allocation. Institutions can obtain low-cost funds through the issuance of stablecoins and invest in low-risk assets to generate returns. The larger the issuance, the more substantial the potential returns.

Industry Pain Points Still Exist

Despite the promising outlook, the stablecoin industry still faces numerous challenges:

1. Insufficient regulatory rules lead to compliance and financial risks for existing stablecoins.

2. The issue of reserve asset security. Although the 1:1 reserve enhances security, it is still necessary to be alert to the risks of the reserve assets themselves.

3. Cross-border payment compliance challenges. Ensuring that stablecoins are strictly tied to reserves and preventing over-issuance and fraudulent activities are key regulatory focuses.

4. Anti-money laundering challenges. Stablecoins may be used for illegal purposes, requiring enhanced regulation.

5. High compliance costs are one of the main issues faced by industry participants.

6. Potential impact on the monetary sovereignty of certain countries. The convenience of stablecoins may lead to a large-scale sell-off of some countries' currencies, affecting financial security.

Industry insiders believe that these issues require the joint efforts of regulatory authorities, issuing institutions, and market participants to promote the healthy development of the stablecoin industry.