Why Beijing’s Clampdown on Stablecoins Fuels Hong Kong’s Financial Revolution
The post Why Beijing’s Clampdown on Stablecoins Fuels Hong Kong’s Financial Revolution appeared on BitcoinEthereumNews.com. Beijing suspends the promotion of stablecoin in order to evade market risk. Hong Kong introduces a licensing regime of stablecoins that is quite strict but open. There is a conflict in the regulatory models, leading to increased cross-border finance tensions. Chinese financial authorities have limited the promotion of stablecoins on the country’s mainland. They instructed brokerages and research companies to cease all seminars and publications promoting stablecoins out of concerns of speculation and fraud, according to Bloomberg. The purpose of the action is to calm the growing excitement about crypto coins tethered to the dollar as more people become aware of scams. The difference between Beijing’s cautious attitude and Hong Kong’s strategic acceptance of digital currency innovation is shown by this stark contrast. Why Beijing is Putting the Brakes on Stablecoins Chinese officials regard stablecoins as a possible threat to unlawful fundraising initiatives and market volatility. In late July, officials told major brokerages and research firms to cease marketing stablecoins and end related activities. This is of national concern as Shenzhen authorities cautioned its citizens against scams masquerading as stablecoin investments earlier this year. For settlements in the cryptocurrency market and international money transfers, stablecoins, blockchain tokens tied to a fiat currency like the US dollar—are widely employed. Yet, Beijing remains wary of these uses. People Bank of China is exploring the potential of privately issued digital currency with caution but keeping a strict control to avoid frenzy and capital outflow in the market. Hong Kong’s Bold Leap Forward in Stablecoin Regulation As Beijing contemplates a change in strategy, Hong Kong introduced a mature stablecoin issuer framework that pledges to provide stringent but predictable licensing criteria, but not so tight as to quash innovation. In order to keep market quality high, the Hong Kong Monetary Authority (HKMA) is expected to…
The post Why Beijing’s Clampdown on Stablecoins Fuels Hong Kong’s Financial Revolution appeared on BitcoinEthereumNews.com.
Beijing suspends the promotion of stablecoin in order to evade market risk. Hong Kong introduces a licensing regime of stablecoins that is quite strict but open. There is a conflict in the regulatory models, leading to increased cross-border finance tensions. Chinese financial authorities have limited the promotion of stablecoins on the country’s mainland. They instructed brokerages and research companies to cease all seminars and publications promoting stablecoins out of concerns of speculation and fraud, according to Bloomberg. The purpose of the action is to calm the growing excitement about crypto coins tethered to the dollar as more people become aware of scams. The difference between Beijing’s cautious attitude and Hong Kong’s strategic acceptance of digital currency innovation is shown by this stark contrast. Why Beijing is Putting the Brakes on Stablecoins Chinese officials regard stablecoins as a possible threat to unlawful fundraising initiatives and market volatility. In late July, officials told major brokerages and research firms to cease marketing stablecoins and end related activities. This is of national concern as Shenzhen authorities cautioned its citizens against scams masquerading as stablecoin investments earlier this year. For settlements in the cryptocurrency market and international money transfers, stablecoins, blockchain tokens tied to a fiat currency like the US dollar—are widely employed. Yet, Beijing remains wary of these uses. People Bank of China is exploring the potential of privately issued digital currency with caution but keeping a strict control to avoid frenzy and capital outflow in the market. Hong Kong’s Bold Leap Forward in Stablecoin Regulation As Beijing contemplates a change in strategy, Hong Kong introduced a mature stablecoin issuer framework that pledges to provide stringent but predictable licensing criteria, but not so tight as to quash innovation. In order to keep market quality high, the Hong Kong Monetary Authority (HKMA) is expected to…
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