Author: Will Awang
After missing its deadline last month, the Hong Kong Monetary Authority (HKMA) recently issued its first batch of stablecoin licenses—to HSBC and Standard Chartered, consistent with our previous analysis in the article "Hong Kong Dollar Stablecoins Don't Need to Become USDC".
While the outcome itself was hardly surprising, it was disappointing.
Coincidentally, I've been following Professor Jiang Xueqin's series on geopolitical game theory, and Rain also wrote a piece titled "Hong Kong Stablecoins: A Carefully Designed 'Open Scheme'". Putting these two things together, I want to try to take a "wild" look at this licensing round from a game theory perspective, hoping to amuse everyone.
Jiang Xueqin's logic in analyzing Trump's Iran war goes like this: On the surface, this war was a foolish blunder. But if we use game theory and change the assumption—what if Trump *wanted* this "failure"? Then he might be a genius.
This article applies the same framework to Hong Kong's stablecoins, to hypothesize a top-tier "open scheme".
I. A List That Disappoints Everyone
The first batch of stablecoin licenses released by the HKMA yesterday was the version the market least wanted to see:
Standard Chartered, HSBC; Bank of China (Hong Kong) was absent.
This result is disappointing. Foreign banks have no natural interest in issuing HKD stablecoins, a strategically motivated entity like BOCHK was instead sidelined, and key scenario players—brokerages, exchanges, internet companies—were systematically excluded from the legislative consultation stage.
With the first batch of licenses, the narrative for Hong Kong stablecoins has been sentenced to a "suspended death sentence".
But if you were the HKMA, would you choose such a list?
You hold the complete experience from the 2024 Project Ensemble sandbox, you've seen all the case studies of the digital yuan from立项 to promotion, you wield the natural advantage of the SFC + HKMA dual-track system—and then you choose a list that can't even achieve the most basic commercial closed loop?
Unless, this list that disappoints everyone was never meant to satisfy the market.
II. A Reverse Inference: What if the Initial Assumption Was Wrong?
Understanding this list requires a different framework.
Lately, I've been watching Jiang Xueqin's game theory series. The episode from April 2nd, on Trump's Iran war, had a line that stuck with me:
"I understand Donald Trump's an idiot. I understand that he's going to lose his war in the Middle East. But let's put our thinking caps on. Let's use game theory and say — what if for some strange reason Donald Trump wants to lose his war in Iran? Then he'd be a genius."
— Professor Jiang, Game Theory#18, April 2, 2026
Jiang Xueqin's argument structure is simple: If you assume Trump wants to "win", then his every move is inexplicably stupid. But if you reverse the assumption—he wants precisely to "lose this war", using a controlled Middle Eastern collapse to shift global energy dependence to North America—every seemingly idiotic action instantly becomes a coherent strategy.
This is called Managed Collapse. Not avoiding failure, but engineering a failure that benefits oneself.
Looking back, if you assume the goal of this licensing round was to "grow the HKD stablecoin industry", then every detail is hard to explain—issuing to the least motivated institutions, setting thresholds so high they're commercially unviable, repeatedly challenging applicants' business logic, excluding the most motivated strategic entities.
But if you change the assumption—what if the intended beneficiary was never the "commercial stablecoin industry" itself?
Then everything becomes coherent.
Following this assumption, the three lines of scenarios, institutions, and infrastructure all align.
III. Scenario Level: Three False Premises
Every applicant tells three stories: cross-border payments, RWA, and C-end consumption.
But all three are untenable.
A. Cross-Border Payments is a False Premise
The typical chain is: Company A in Country A mints Stablecoin A with fiat, swaps it for Stablecoin B on a secondary market, pays Company B in Country B, which redeems it for Fiat B. The essence is reducing the cost of foreign exchange, monopolized by banks, through Web3 exchanges—this is financial inclusion for SMEs, logically sound.
But in this chain, the stablecoin's lifecycle is only momentary, during the transfer.
Unless Company B immediately uses the stablecoin for its next trade, it must still redeem it, needing fiat. What's needed isn't a one-time transfer, but a closed loop where there's always a "next buyer".
Rain pointed out something crucial—more致命的是 the Fisher Equation. MV = PT, the money supply multiplied by its velocity equals price level multiplied by real output. The circulation velocity of on-chain stablecoins is an order of magnitude (or more) higher than traditional bank clearing.
This means: The required stock of stablecoins to support the same trade volume is反而 lower. The more successful cross-border payments are, the lower the demand for stablecoin deposits.
This isn't a closed loop; it's an anti-loop.
B. RWA is a False Premise
So-called RWA is essentially the same thing: tokenization of asset shares.
Funds are raised in stablecoins, but the asset manager, upon receiving them, must go buy the underlying assets, and the asset sellers almost never accept stablecoins—they securitize assets precisely to exit or optimize cash flow; no one wants stablecoins.
The result: The lifecycle of stablecoins in the RWA scenario is only the fundraising period.
C. C-End Consumption
In a word: Hong Kong's retail market is too small, not worth mentioning.
All three stories are false premises. And the HKMA, as the regulator following the entire process, knows this better than any applicant.
So why issue licenses?
IV. Institutional Level: A "Voluntary" List
HSBC and Standard Chartered—likely neither came with strategic intent.
On HSBC's side, participation in the application was likely passive. This makes sense—HSBC's strategic focus has long shifted away from stablecoins; what it's really pushing is tokenized deposits. For HSBC, applying for an HKD stablecoin is more of a defensive move, not an active strategy.
Standard Chartered has some initiative, but for it, Hong Kong is just one node in its global map. An HKD stablecoin can connect to its Libeara platform, but Hong Kong was never its main battlefield.
BOCHK, which has the will and local scenarios—absent.
Strange? Not at all. Once you understand the Hong Kong government was designing a mechanism where "voluntary" becomes the optimal choice:
Rule 1: Licenses only issued to note-issuing banks
This immediately creates an exclusive club. If HSBC didn't apply, it would mean only Standard Chartered's name would be on the future digital HKD track. For an institution that holds "HKD note-issuing bank" as a core brand asset for 160 years, this is an unbearable symbolic loss. So HSBC had to follow.
Rule 2: Extremely high technical and compliance thresholds
Building self-owned HSM data centers costing tens of millions of dollars, AML architecture, on-chain monitoring, reserve asset pools... going through all this makes issuing stablecoins a pure cost center, not a business. Normal commercial institutions would退出 after calculating ROI. But HSBC and Standard Chartered can't退出—Rule 1 already locked them in.
They aren't here to make money; they are here to not lose their seat.
Rule 3: Repeatedly challenge business logic
This is the most ingenious. The Hong Kong government, during the interview stage, repeatedly asked applicants the same question: Why issue your own instead of using someone else's? This等于 telling applicants upfront—I don't care if you can make money. The applicants who could stay could only answer one thing: "I can help Hong Kong run this infrastructure."
With these three rules叠加, the Hong Kong government actually forced nothing.
HSBC and Standard Chartered "voluntarily" applied, "voluntarily" invested tens of millions of USD, "voluntarily" bore user education and scenario development costs. But each "voluntary" choice was the optimal choice under the preset rules of the Hong Kong government.
This isn't an order; it's design.
And BOCHK's absence is no longer strange—the entity with the strongest strategic意志 is反而不适合 as an infrastructure contractor. Entities with strong strategic will would turn stablecoins into their own commercial product, with their own rhythm and demands. What the Hong Kong government wants isn't commercial products; it's infrastructure.
Besides, BOCHK is on another track anyway.
V. Infrastructure Level: Leveraging Momentum to Push Something Previously Unpushable
What the HKMA really wants is e-HKD.
e-HKD is the Hong Kong government's digital currency—the Hong Kong version of the digital yuan. The goal is clear: gradually migrate interbank clearing and mass retail payments to the chain-based Hong Kong dollar issued by the central bank. This is the next-generation financial infrastructure the Hong Kong government has been pushing for years, and it's the ultimate goal of the entire strategy.
The 2024 Project Ensemble sandbox was the first attempt on the e-HKD path: banks and the government maintaining a consortium链 together, tokenizing deposits,重构 interbank clearing and settlement. The technology worked, but the initiative stalled—only HSBC and Standard Chartered were willing to join; small and medium-sized banks lacked motivation.
The reason it couldn't be pushed wasn't technology; it was a lack of kinetic energy on the demand side. User education costs, scenario development costs, technical trial-and-error costs—no one was willing to pay for these three things.
A recent footnote is right in Hong Kong. In May 2024, the digital yuan was officially connected to Hong Kong's "Faster Payment System" (FPS), becoming the world's first bilateral interconnection between a "central bank digital currency + fast payment system". Two years on, by March 2026, there were about 80,000 digital yuan wallets in Hong Kong, with 5,200 merchant access points, and 18 local banks participating in top-ups—for a market of 7.5 million people, these are far from "widespread" numbers.
What Hong Kong residents actually use daily are still Alipay HK, WeChat Pay HK, and FPS itself.
Incidentally, back to the question in Section IV: Why was BOCHK absent from the stablecoin list? The main institution promoting the digital yuan's landing in Hong Kong is precisely BOCHK. In October 2025, BOCHK collaborated with Circle K and FreshUp, enabling over 380 convenience stores and 1200 vending machines across Hong Kong to accept digital yuan payments.
In other words, BOCHK's strategic focus has always been on the digital yuan track. Its absence from the stablecoin list isn't an exclusion; it's simply because it's already doing something more direct.
The Hong Kong government sees very clearly: If it relies on itself alone, e-HKD will never take off. Then came the stablecoin hype.
Stablecoins provided the Hong Kong government with something it could never create itself: free demand-side kinetic energy. Hype, media, KOLs, VCs, global narrative, all for free. Then the rest follows logically.
Phase 1: Have licensed banks use the "commercial stablecoin" narrative to acquire users, develop scenarios, and test technology. HSBC and Standard Chartered掏 their own pockets to build HSM data centers, handle KYC/AML, educate the public on using on-chain HKD, persuade merchants to接入, and operationalize cross-border B2B scenarios—all things e-HKD wanted to do but couldn't.
Phase 2: Once user habits, clearing habits, and tech stack are established, the government推出 its clearing layer as the necessary path for interbank clearing and settlement; licensed stablecoins are incorporated into this轨道 during the clearing环节. Later, e-HKD is launched as a native asset, and licensed stablecoins gradually become an "upper-layer wrapper" for e-HKD.
The brands, wallets, and interfaces users see remain unchanged, but the underlying clearing has already completed its回收 from commercial banks to the central bank.
This path almost 1:1 corresponds to the digital yuan's "two-tiered operation" architecture: direct participants at the front, the central bank at the back.
The same architecture, two different approaches. The difference is—China pushes top-down硬推, Hong Kong pushes bottom-up借势推.
The Hong Kong government intends to use the stablecoin regulations to push e-HKD, not use e-HKD itself to push e-HKD.
VI. From Global Financial Center to HKD Clearing Sovereignty
Hong Kong's current core asset is depreciating.
Hong Kong's status as an international financial center over the past decades was fundamentally built on one thing: access to the US dollar clearing system. Stock financing, interbank lending, trade settlement, private banking—all were rooted in this.
But this asset is now松动 on three fronts simultaneously—the increasing politicization of the dollar system itself makes access uncertain, the sluggish return of US-listed Chinese stocks weakens the primary market, and geopolitical conflicts raise the costs of traditional correspondent banking channels.
The competition for the next generation of international financial centers is no longer about who has the larger stock market or more private banking funds, but about who masters the next-generation financial infrastructure and clearing sovereignty.
The US is using the GENIUS Act to co-opt stablecoins into the dollar clearing system, making USDC a digital extension of the dollar. Europe is using MiCA to make EMTs the digital version of euro clearing. China is using the digital yuan to重构 cross-border RMB clearing.
The three major currency zones are all doing the same thing: extracting their currency's clearing sovereignty from the SWIFT-era correspondent banking architecture and placing it into their own CBDC or stablecoin architecture.
Hong Kong has no monetary sovereignty—under the Linked Exchange Rate system, the HKD's issuance权 is依附于 the US dollar. But what Hong Kong can fight for is clearing sovereignty: making HKD clearing no longer entirely dependent on traditional SWIFT and correspondent banks, but built on a next-generation infrastructure controlled by the HKMA.
Looking at this licensing round from this perspective, everything makes sense:
- The "commercial stablecoin" narrative was never the goal; it was a tool;
- The purpose of HSBC and Standard Chartered is to complete user education and scenario operationalization for the Hong Kong government;
- BOCHK's absence is not an oversight; it's to keep strategic intentions low-key;
- VAOTC might never truly land, because its historical mission of hype is already complete.
This is a controlled narrative downgrade—letting the surface-level Web3 hype be consumed, allowing the underlying clearing sovereignty to be built.
As Jiang Xueqin said, failure is the point.
The key is who designed this "failure", and who truly takes something from it.
VII. In Closing
Does Hong Kong have Web3? Thinking about our noisy few years, it似乎 does. But from a historical perspective, it might never have.
What needs thinking is, after Web3 is distilled, what remains?
Actually, Hong Kong never needed Web3—Hong Kong needs the entry ticket to the next generation of financial centers.
And this entry ticket, the first batch of licensed stablecoin issuers are paying for it.
