Hong Kong dollar stablecoins are moving beyond simple payments, while traditional banks face a structural trade-off as they issue fully reserved stablecoins. HashKey senior researcher Tim Sun told crypto.news that HKDAP and other regulated HKD stablecoins could serve as an on-chain settlement vehicle for cross-border settlement, corporate treasury management, digital asset trading and tokenized finance.
The first institutional tests have already begun. On Aug. 14, HashKey Exchange completed a live HKDAP transaction with YF Life Insurance International using real funds, covering subscription and redemption. YF Life said it planned to support HKDAP premium payments subject to regulatory requirements. HashKey also partnered with insurer OneDegree to explore local and cross-border HKDAP use cases.
On Aug. 13, Unloq's SC+ trade-finance infrastructure completed a Hong Kong receivables-financing transaction using HKDAP as the settlement instrument. Standard Chartered Bank (Hong Kong) became HKDAP's first bank distributor on Aug. 24. Finloop and Yunfeng Financial joined as authorized distributors on Aug. 25 and Aug. 26, while Bank of East Asia signed an agreement with Anchorpoint on Aug. 28.
Anchorpoint began beta access on Aug. 12 for institutional distributors and professional investors. Before the rollout, Anchorpoint, OSL Group and Futu-backed PantherTrade tested HKDAP transfers on Ethereum mainnet in May. The token has a par value of HK$1 and must be backed by reserves with market value at least equal to outstanding tokens. Hong Kong Monetary Authority granted its first stablecoin issuer licenses to Anchorpoint and HSBC in April under the Stablecoins Ordinance, which took effect in August 2025. Anchorpoint was formed by Standard Chartered Bank (Hong Kong), HKT and Animoca Brands.
Sun argued that HKD stablecoins matter because they allow the Hong Kong dollar to participate in on-chain financial infrastructure, preventing long-term dependence solely on U.S. dollar stablecoins. This comes as the U.S. builds its own framework under the GENIUS Act, signed in July 2025, although regulators missed the July 18, 2026 deadline for completing key implementing rules ahead of the Jan. 18, 2027 effective date.
The second report highlights how bank-issued stablecoins are reshaping balance sheets. J.P. Morgan processes over $3 trillion through Kinexys, Société Générale issues EUR CoinVertible on public blockchains, and the Qivalis consortium aggregates 37 banks from 15 European countries to launch a euro-denominated stablecoin in the second half of 2026.
Under the GENIUS Act, payment stablecoins require 1:1 backing with eligible reserves, unlike demand deposits that support fractional reserve lending. A $100 million deposit base can support roughly $900 million in new loans, but the same amount moved into a fully reserved stablecoin contracts the credit multiplier from about 9x to 1x on the marginal dollar. The Bank for International Settlements has documented that household demand for stablecoins can raise deposit rates, increase bank funding costs and reduce aggregate credit supply.
The total stablecoin market is roughly $305 billion as of mid-2026, with Tether's USDT at $184 billion and Circle's USDC at $74 billion. Stablecoins offer DeFi yields of 5% to 8% versus average U.S. savings account yields of 0.6%. J.P. Morgan uses JPM Coin as a tokenized deposit to preserve lending capacity, while Société Générale's EURCV is closer to a fully reserved payment stablecoin.
Qivalis, which includes BNP Paribas, ING, UniCredit, ABN Amro and Banco Sabadell, aims to avoid fragmentation into incompatible stablecoin silos. A White House report published in April 2026 estimated that prohibiting stablecoin yields would increase bank loans by only 0.02%, around $2.1 billion against a $12 trillion portfolio. Galaxy Digital estimates that for every $1 of compliant stablecoin issued, about $0.32 of new credit creation occurs, with the net effect depending on whether funds come from new inflows or existing deposits.
