Bank of China HK rallies as license speculation grows
Bank of China Hong Kong jumped 6.7% in Monday trading after local media reported the bank is preparing to apply for a stablecoin issuer license. The stock rose as much as 8.5% before closing up 6.7%.
Local reports said Bank of China Hong Kong has formed a dedicated team to pursue the license under Hong Kong's new regulatory framework. The bank's spokesperson declined to comment.
The speculation emerged one month after Hong Kong's stablecoin law took effect. The Hong Kong Monetary Authority oversees the licensing regime, which requires companies to meet standards for reserve management, redemption procedures, governance, anti-money-laundering controls and public disclosures.
The HKMA expects to issue only a limited number of licenses initially. The authority said the first approvals will likely come in early 2026. Issuers must maintain full backing with high-quality, high-liquidity reserve assets and honor redemptions at par. Companies must also segregate client funds and meet management standards.
On August 14, regulators warned investors about sharp price swings in companies linked to digital asset projects. The HKMA and Securities and Futures Commission issued a joint statement after several firms' shares surged on preliminary announcements or media speculation about license applications.
The HKMA invited interested institutions to contact the regulator before the end of August for early feedback ahead of the formal licensing process. The authority emphasized that early engagement or expressions of interest should not be interpreted as approval.
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