Hong Kong’s de facto central bank has announced the launch of a stablecoin “sandbox”, allowing companies to trial cryptocurrency tokens pegged to fiat currency in the city, the Hong Kong Monetary Authority (HKMA) announced on Tuesday.
The purpose of the sandbox is to allow for stablecoin trials “within a limited scope and risk-controlled environment”, according to the HKMA, and it will allow the bank to “communicate supervisory expectations and guidance” to potential issuers. There is no limit on the number of entities that can participate, but applicants must show a “genuine interest in and reasonable plan on issuing fiat-referenced stablecoins”. Applicants must also have a plan for participating in the sandbox and show “a reasonable prospect of complying” with the regulations proposed in December, which are still under review following public feedback.
“The sandbox arrangement … will facilitate the…
