The Hong Kong General Chamber of Commerce (HKGCC) has made suggestions for the local government’s next budget, proposing that officials should allow the creation of stablecoins linked to the Chinese yuan.
In a statement made on Tuesday, the HKGCC recommended that the government should think about letting companies issue yuan-linked stablecoins or stablecoins supported by a mix of different currencies, including the yuan, the Hong Kong dollar, or the U.S. dollar.
Additionally, the HKGCC suggested looking into the idea of starting a “Virtual Asset Connect Scheme” with a daily limit of about HK$20 billion ($2.5 billion). However, their proposal did not give more details about this scheme.
These recommendations are being made as the Financial Secretary prepares to give the budget speech later in the month. The HKGCC emphasized that their main goal is to keep and attract more talent and businesses to Hong Kong to improve the city’s business environment and address the shortage of skilled workers.
In December, the Hong Kong Monetary Authority, in collaboration with the Financial Services and the Treasury Bureau, mentioned in a consultation paper that any stablecoin issuer in Hong Kong would need a license to issue a stablecoin pegged to fiat currencies. This consultation will conclude at the end of the month.
Christopher Hui, the Secretary for Financial Services and the Treasury, mentioned in a blog post last week about the HKMA’s plan to start a sandbox program to test stablecoin issuance with significant players in the industry.
Eddie Yue, the chief executive of the HKMA, spoke in December about the potential role of stablecoins in bridging traditional finance and the virtual asset market. He stated that if stablecoins become a popular payment method, it would be crucial for these to be truly stable to ensure a seamless integration between digital payments and the real economy.
