The East and West Compete for the Discourse Power of Stablecoins: The United States and Hong Kong Accelerate Legislation to Reshape the Global Financial Landscape

This week, the U.S. Senate and the Hong Kong Legislative Council made significant progress in stablecoin regulation almost simultaneously. The U.S. cleared the path for the first federal stablecoin legislation by passing the GENIUS Act procedural motion with an overwhelming majority. Meanwhile, Hong Kong passed the third reading of the Stablecoin Bill, becoming the first jurisdiction in the Asia-Pacific region to establish a stablecoin licensing system. This high degree of alignment in legislative timing between the East and West is not just a coincidence of timing but also reflects the fierce competition for future financial discourse power.

The stablecoin market has enormous potential

According to data platform statistics, the global stablecoin market capitalization is close to $250 billion, having grown more than 22 times over the past 5 years. From the beginning of 2025 to now, on-chain transaction volume has surpassed $3.7 trillion, and it is expected to approach $10 trillion for the entire year. Digital assets represented by dollar stablecoins are widely used for trading and remittances in emerging markets, with usage in some regions even exceeding that of traditional payment systems. Stablecoins have jumped from being marginal assets to key nodes in the global payment network and sovereign competition. The United States and Hong Kong have both accelerated legislation almost simultaneously, marking the entry of the global stablecoin market into a period of compliance acceleration.

Based on the current regulatory signal release rhythm and institutional funding attitudes, and referring to a previous estimation model from a certain bank, we predict that under an optimistic scenario where the global compliance framework gradually improves and institutions and individuals widely adopt it, by 2030, the global stablecoin market supply will reach 3 trillion USD, with monthly on-chain transaction volume reaching 9 trillion USD, and annual transaction total possibly exceeding 100 trillion USD. This means that stablecoins will not only stand shoulder to shoulder with traditional electronic payment systems but will also occupy a structurally fundamental position in the global clearing network. In terms of market capitalization, stablecoins are expected to become the "fourth category of basic monetary assets" following government bonds, cash, and bank deposits, serving as an important medium for digital payments and asset circulation.

It is worth noting that under this growth trend, the reserve structure of stablecoins will also have a significant impact on the macro economy. Currently, the scale of stablecoins has absorbed about 3% of the upcoming short-term U.S. Treasury bonds, ranking 19th among overseas U.S. Treasury bond holders. Considering that the new legislation may require 100% high liquidity U.S. dollar assets as reserves, short-term U.S. Treasury bonds are seen as the main choice. If estimated based on a 50% allocation ratio, a market value of $3 trillion would correspond to at least $1.5 trillion in short-term U.S. Treasury bond demand. This scale is already close to the current U.S. Treasury bond holdings of major overseas sovereign buyers such as China or Japan, and stablecoins are expected to become the "largest invisible creditor" of the U.S. Treasury.

Comparison of Regulatory Frameworks between the United States and Hong Kong

Although there are differences between the United States and Hong Kong in legislative paths and certain details, there is a high degree of consensus on fundamental principles such as "fiat currency anchoring, full reserves, and licensed issuance."

The US GENIUS Act focuses on "payment-type stablecoins", which are stablecoins pegged to fiat currencies like the US dollar, promising a 1:1 redeemability without interest returns, emphasizing their non-security nature, and aiming to prevent stablecoins from evolving into financial products with investment characteristics. Meanwhile, Hong Kong has not yet restricted interest returns and pegging structures, under the premise of ensuring a 1:1 full peg, seeking to carve out a new path in the dollar-dominated stablecoin market and reserving space for future innovations.

In terms of reserve requirements, both places require sufficient anchoring of high liquidity assets, but the US legislation explicitly limits the types of qualifying reserve assets, including short-term government bonds, cash, and repurchase agreements, and requires monthly audits; Hong Kong also requires audits and segregated custody, but the types of reserve assets are not fully specified.

In terms of institutional framework, the United States adopts a "federal-state" dual-track system, providing three paths for stablecoin issuance: banks or their subsidiaries apply to issue stablecoins, regulated by federal regulatory agencies; non-bank institutions can apply to become licensed issuers through federal agencies or obtain licenses through state regulatory agencies. In Hong Kong, the Monetary Authority issues licenses uniformly and requires that regardless of whether the stablecoin issuer is based in Hong Kong, as long as it is pegged to the HKD or actively provides services to the public in Hong Kong, a license must be applied for.

In terms of managing offshore issuers, the United States explicitly prohibits the circulation of unlicensed overseas stablecoins in the US market, authorizing relevant departments to establish a "non-compliant stablecoin list" and blocking their circulation paths through US digital asset service providers; Hong Kong, on the other hand, mainly focuses on stablecoins pegged to the Hong Kong dollar and maintains an open attitude towards non-HKD stablecoins.

These institutional differences reflect the varying demands regarding the positioning of stablecoins in the two regions. The United States primarily aims to maintain the dominance of the dollar and serve the structural financing needs of its fiscal system, promoting stablecoins as an extension of on-chain dollars; meanwhile, Hong Kong hopes to attract global Web3 projects without compromising local financial stability, leaving room for policy flexibility in many details, with the aim of creating a controlled yet open and compatible compliance innovation testing ground in the Asia-Pacific.

The Impact of Stablecoin Regulation on the Web3 Ecosystem

The true significance of stablecoin regulation lies in providing the foundation for payment and settlement for the large-scale adoption of Web3.

In the field of decentralized finance, although mainstream stablecoins have become important settlement assets for on-chain financial innovation, the lack of clear legal status and accountability mechanisms makes it difficult for institutions to participate directly. If relevant regulatory frameworks are successively implemented, stablecoins provided by compliant issuers will become the clearing core of "compliant DeFi," with protocols embedding more KYC, AML, and asset identification modules, leading decentralized finance to gradually evolve into a "verifiable on-chain financial network."

In the Web3 payment system, the implementation of stablecoin regulation will break the gray boundary between past payment scenarios and asset circulation, allowing stablecoins to truly transition from "transaction intermediaries" to "payment channels." Several payment technology companies have successively embedded stablecoins into their merchant settlement processes; Web3 wallets are expanding micro-payment scenarios such as top-ups, tips, and subscriptions with stablecoins as the default payment asset. On-chain payments are transforming from "transfer tools within the crypto circle" to "enterprise-level financial interfaces," and compliance is a necessary prerequisite for this transformation.

A deeper change lies in the reshaping of the global settlement structure: stablecoins, pegged to fiat currency at a 1:1 ratio, have bridged the connection between local currency and on-chain assets, while not relying on the banking account system, enabling "peer-to-peer" settlement. This means that in the future scenarios of cross-border payments, on-chain trade financing, and physical asset dividends, stablecoins may replace traditional banks as the central hub of fund circulation.

In the past, we discussed the large-scale adoption of Web3, overly focusing on technological breakthroughs and user experience while neglecting the legitimacy of underlying assets. Now, compliant stablecoins provide the "last piece of the puzzle": they are both institutionally recognized trading assets and possess the programmability for on-chain circulation. They are digital mirrors of the US dollar and Hong Kong dollar, and can be directly utilized in decentralized finance protocols and NFT transactions.

In other words, stablecoins are not just an accessory to Web3, but one of the driving forces pushing it toward the mainstream. With the support of compliant stablecoins, everything from physical asset trading to on-chain salary payments, from cross-border settlement to Web3 payment interfaces, stablecoins will become the "infrastructure assets" that drive the large-scale adoption of the on-chain economy.