Hong Kong Financial Secretary Paul Chan: Redemption requests from stablecoin holders must be completed within one working day

ChainCatcher news, Hong Kong's Secretary for Financial Services and the Treasury, Hui Ching-yu, stated in an interview yesterday that the underlying asset of stablecoins is fiat currency, which can later be used for payment functions in the form of electronic assets through technologies such as blockchain.

Hui Ching-yu mentioned that the issuers of stablecoins are regulated by the Hong Kong Monetary Authority, and the main principles of regulation are similar to those of traditional financial assets. Relevant issuers must comply with regulations regarding reserve asset management and redemption, including properly segregating customer assets. When stablecoin holders request redemption, it must be completed within one working day to meet user demands.

Hui Ching-yu further added that due to the payment characteristics of stablecoins, when services or projects are conducted in the "Belt and Road" regions, and the local currency exchange rates are volatile or the financial system is not very mature, using local currency for payments may pose certain risks. In such cases, the counterparties can use stablecoins for payment purposes.