Stablecoin regulation in Hong Kong, Singapore, and Dubai

Hong Kong’s Regulatory Framework

The Hong Kong Monetary Authority (HKMA) regulates fiat-referenced stablecoins under the Stablecoins Ordinance, which took effect on August 1, 2025. This law prohibits licensed issuers from paying interest or yield to stablecoin holders. In April 2026, the HKMA issued its first two stablecoin licenses to Anchorpoint Financial and the Hongkong and Shanghai Banking Corporation. By August 2026, the first regulated HKD stablecoin, HKDAP, entered beta using Standard Chartered as the bank distributor. The city received 36 stablecoin applications by September 30, 2025. The HKMA expects only a small number of licenses in the first batch, focusing on institutional-grade and business-to-business use cases. The Hong Kong Monetary Authority expects only a handful of licenses for the first batch, focusing specifically on institutional-grade and business-to-business use cases while emphasizing strict reserve management and cybersecurity protocols for all regional participants. Issuers of stablecoins backed by offshore yuan must clearly specify the assets used as reserves. A six-month transitional period for existing issuers expired on February 1, 2026. To prepare for a license, firms must complete a funds-flow map, a perimeter memorandum, and preliminary discussions with competent authorities. The HKMA also checks the capital, financial stability, home supervision of foreign banks, management risks, and internal controls of all applicants. Meanwhile, the Securities and Futures Commission (SFC) oversees virtual asset trading platforms, recommending that they provide both security and non-security token perimeters.

Singapore and Dubai Standards

Singapore’s Monetary Authority (MAS) implemented its single-currency stablecoin framework on July 1, 2026. This regime targets stablecoins pegged to the Singapore Dollar or any G10 currency. Issuers must hold liquid assets equivalent to 100% of the par value of outstanding stablecoins in the same currency. The MAS requires a minimum base capital of S$1 million or 50% of annual operating expenses. Users can redeem stablecoins at par value within five business days of a request. This framework builds on Project Guardian, which tested tokenized foreign exchange and fixed income since 2022. The regulatory regime for single-currency stablecoins in Singapore provides a mark of trust and compliance for users. In Dubai, the Virtual Assets Regulatory Authority (VARA) oversees all virtual asset activities outside the DIFC. VARA regulates exchanges, broker-dealers, custodians, lending platforms, payment providers, and token issuers. The licensing process requires an Initial Disclosure Questionnaire followed by a full application containing business and compliance models. VARA requires whitepaper disclosures and mandates that issuers hold reserves in highly liquid assets. VARA punishes non-compliance with fines reaching AED 500,000 and license cancellations. If you want to launch in Dubai, you must submit a detailed business plan and financial projections to the regulator. Does the heavy compliance burden in Dubai prevent smaller developers from entering the market?

Comparison of Regional Rules

Different jurisdictions impose distinct rules on how issuers manage reserves and handle redemptions. Hong Kong mandates 1:1 backing and requires redemption within one business day. Singapore demands 100% high-quality liquid reserves in the same currency as the peg.

The Hong Kong government plans to submit an amendment bill before the end of 2026 to establish licensing regimes for digital asset trading, custody, advisory, and management services. This follows the city’s move to boost its status as a global digital asset hub. OSL, which holds Type 1, 4, and 9 licenses, provides institutional-grade digital asset services including OTC brokerage, custody, wealth management, and retail services.