Hong Kong’s First Digital Launches Stablecoin Amid New Laws

Hong Kong gets ahead of crypto regulation: the FDUSD stablecoin launched in a new regulatory environment.

Man in sunglasses surrounded by chinese lanterns looking up to a crypto coin.
Created by Kornelija Poderskytė from DailyCoin
  • Hong Kong recently introduced a clear legal framework for crypto businesses.
  • The new ruling takes action on July 1st, 2023, and seeks to protect retail investors.
  • First Digital-owned trust launches the $FDUSD stablecoin on Ethereum and BSC.

The First Digital crypto hedge fund launched a new stablecoin pegged to the United States Dollar. The $FDUSD stablecoin’s reserves are topped with cash, securities, and other “high-quality reserves,” which are regulated according to the new crypto-focused regulatory framework.

The new crypto legislation kicks in on the first summer day, meaning that Hong Kong’s Trust Ordinance requires the new FDUSD stablecoin to hold reserves in separate accounts to prevent the commingling of reserve funds. The stablecoin is compatible with Ethereum (ETH) and Binance Smart Chain (BSC).

A New Home for Fully Regulated Stablecoins?

The new USD-pegged stablecoin will be fully compatible with Binance Smart Chain, according to a fresh tweet by Binance’s CEO Changpeng ‘CZ’ Zhao.


Binance, the largest crypto exchange globally, had lost an eye-watering $18 billion market cap ever since the U.S. Securities and Exchange Commission (SEC) banned Paxos, the stablecoin issuer, from minting any new $BUSD. Ultimately, the SEC argues that Binance USD (BUSD) was an ‘unregistered security’ without providing any clear framework for its issuance.

Fortunately, Hong Kong’s legal framework is deemed much more coherent by many lawyers and investors on Crypto Twitter. The Hong Kong Monetary Authority (HKMA) and Securities and Futures Commission (SFC) have strict requirements, including a minimum of 12 months of regulatory compliance, before the cryptocurrency can be fully open for public trading.

On the Flipside

  • The $FDUSD stablecoin won’t be available for retail traders on launch.
  • Hong Kong Monetary Authority is yet to implement rules for this asset class.

Why This Matters

Stablecoin issuance previously lacked a clear-cut legal framework. Hong Kong can lay the foundation for proper stablecoin regulation.


Read the latest DailyCoin crypto news:

Tether Regains $20B Lost in 2022 After TerraUSD Collapse

Gemini to Enter UAE, Citing High Crypto Enthusiasm in Country

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Tadas Klimasevskis

Tadas Klimaševskis is a Lithuanian journalist at DailyCoin, specializing in covering the lighter side of the crypto industry such as memecoins and pop culture in the metaverse. He has experience as a music artist, English language teacher, and freelance writer, and uses his creative writing skills to summarize valuable information in his work. He is also a strong believer in the potential of blockchain and spends his free time listening to music, traveling, and watching basketball games.