Starting August 1, 2025, it will be illegal in Hong Kong to offer or advertise unlicensed fiat-referenced stablecoins (FRS) to retail investors. This rule is part of Hong Kong’s new Stablecoin Ordinance.
As per the rule, anyone caught promoting unlicensed stablecoins to retail investors can face a fine of up to 50,000 Hong Kong dollars (around $6,300) and up to six months in jail. The Hong Kong Monetary Authority (HKMA), a region’s central bank, says the law aims to bring trust and stability to the stablecoin market.
HKMA Chief Executive Eddie Yue warned people to avoid unlicensed stablecoins, and using or promoting them could get them into legal trouble.
Yue said there has been a lot of hype and market excitement around stablecoins, which has caused some company shares and trading volumes to rise for no real reason. He noted that many firms have applied for a license, but most of them have weak plans and don’t show they can handle the risks.
According to Yue, only a small number of companies will get permission to issue stablecoins. He said many businesses that applied don’t have the right skills or plans to manage risks properly. Because of this, most of the applications will not be approved.
Other parts of the world are also taking action against illegal crypto ads. For example, the European Union has a law called MiCA. It gives big fines to people or companies that promote crypto without a license. It will fine at least 5 million euros (about $5.8 million) or 3% to 12.5% of their yearly income. However, it does not include jail time.
In the UK, the Financial Conduct Authority has had trouble stopping illegal crypto ads, with only about half being removed as of early 2025.
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