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The Bank of China’s Hong Kong-listed shares jumped 6.7% on Monday, closing at HKD 37.58, after reports suggested its Hong Kong branch may apply for a local stablecoin license. The rumors, tied to China stablecoin licensing plans, quickly fueled investor enthusiasm despite the absence of official confirmation.
According to the Hong Kong Economic Journal, the state-owned bank has formed a dedicated task force to study stablecoin issuance. While the Bank of China has not issued a public comment, it previously told investors during its quarterly earnings call that it was researching digital asset applications and risk management frameworks.
The speculation highlights the market-moving power of China stablecoin licensing plans, even in their early stages.
Hong Kong introduced its stablecoin licensing regime on August 1, overseen by the Hong Kong Monetary Authority (HKMA). The regulatory framework requires issuers to comply with stringent rules on reserve management, redemption guarantees, segregation of client funds, anti-money laundering procedures, and full disclosure of operations.
The rollout came shortly after the United States enacted its first federal stablecoin law, the GENIUS Act, setting up a competitive global regulatory landscape.
Financial institutions have shown early interest in Hong Kong’s rules. Standard Chartered, along with Chinese tech firms JD.com and Ant Financial, are reportedly exploring applications. JD.com’s founder Richard Liu said earlier this year that stablecoins could lower cross-border payment costs for businesses before expanding to consumer transactions.
“Stablecoins present a clear efficiency advantage,” said Vincent Chok, CEO of Hong Kong-based First Digital, in an interview with Decrypt. “Blockchain technology reduces settlement times and bypasses traditional banking fees. The opportunity is especially pronounced in emerging markets where stablecoin adoption provides a hedge against currency volatility.”
The surge in Bank of China’s share price underscores the potential financial upside tied to China stablecoin licensing plans. Analysts suggest that if approved, the bank would become one of the first state-backed issuers to operate under Hong Kong’s regime, positioning it to compete with international players.
“The current trajectory suggests exponential growth in the next two to five years as regulatory clarity improves,” added Chok.
This sentiment reflects a broader investor belief that the intersection of traditional banking and blockchain technology could reshape cross-border payments and financial services.
For Bank of China, a license could mean diversifying revenue streams and reinforcing Beijing’s broader push for digital finance innovation.
Despite growing optimism, Hong Kong regulators have warned against speculative trading based on unverified reports. In mid-August, the Securities and Futures Commission (SFC) and HKMA issued a joint statement urging investors to remain cautious.
“These movements appear to follow corporate announcements, news reports, social media posts or speculations regarding plans to apply,” the regulators said. “Given the significant uncertainties surrounding the outcomes of these preliminary plans or applications, the abrupt market movements highlight the need to stay vigilant in these frenetic situations.”
Their warning reflects broader concerns that China stablecoin licensing plans, while promising, may encourage speculative bubbles before any official approvals materialize.
The next phase will depend on whether the Bank of China formally applies for a license and how regulators evaluate its proposal. If successful, the move could cement Hong Kong as a key hub for stablecoin innovation while providing Beijing with a controlled entry point into global digital asset markets.
For now, the momentum around China stablecoin licensing plans demonstrates both the appetite for regulated stablecoins and the volatility of markets driven by early speculation
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