Bank of China shares jumps in the midst of rumors about Stablecoin -License plans

The Shares of the Bank of China’s Hong Kong-Gente shares rose by 6.7% on Monday and traded at HKD $ 37.58, after local media reports suggested that the Bank’s Hong Kong unit is preparing for a request for a stabile License for issuers.

The Hong Kong Economic Journal reported that the Chinese state bank branch had formed a special task force to explore the issue of the Stablecoin.

The Bank of China did not respond to a request for comments, but in last week’s results it called investors that the research into digital assets applications and their risk management mentioned.

Hong Kong introduced his Stablecoin license regime on 1 August, which means that emptents must be approved from the Hong Kong Monetary Authority (HKMA). The framework imposes strict requirements for reserve management, repayment guarantees, segregation of customer funds, the money laundering of anti-money, disclosure and operators. The rules came shortly after the US took its first federal Stablecoin Act, the Genius Act.

The city regime has already drawn interest from large financial institutions, including Standard Chartered.

Chinese tech giants JD.com and Ant Financial have also announced plans to look for licenses abroad for services that focus on their international companies, including applying in Hong Kong. JD founder Richard Liu said in June that the company wants to use Stablecoins to reduce cross-border payment costs, first for business transfers before they expand to consumers.

Vincent Chok, CEO of First Digital in Hong Kong, said Decrypt The attraction of Stablecoins is in efficiency. “Blockchain technology reduces the settlement times and bypasses the traditional intermediary costs of banks,” he said, adding that the chance “is mainly pronounced in emerging markets, where the growing adoption of Stablecoin users offers a cover to currency drolatility.”

Although the cost benefit varies per gang and transaction type, Chok noted that the acceptance accelerates, because regulation provides clarity. “The current process suggests exponential growth in the next 2-5 years,” he added.

Nevertheless, Hong Kong’s regulators have insisted on restraint. In mid -August, the Securities and Futures Commission (SFC) and the HKMA jointly warned investors that market fluctuations are associated with licensing airs may be misleading.

“These movements look like company announcements, news items, messages on social media or to follow speculations regarding plans,” they said. “Given the important uncertainties about the results of these provisional plans or applications, the abrupt market movements emphasize … The need to remain vigilant in these hectic situations.”