According to Foresight News, Hong Kong’s stablecoin sector is still at a nascent stage, with regulatory and auditing frameworks expected to mature gradually. Sun Deji, Chairman of the Hong Kong Accounting and Financial Reporting Council, cautioned that rushing into detailed auditing standards could stifle the industry’s growth.

The regulatory approach for stablecoins is expected to be similar to the licensing of virtual banks, now referred to as digital banks.

Sun noted that comprehensive guidelines for stablecoin auditing and accounting may only be introduced within the next one to three years.

Under the Stablecoin Ordinance, effective since August 1, stablecoin license holders in Hong Kong must undergo annual independent audits to ensure compliance and transparency. However, Sun clarified that the Hong Kong Accounting and Financial Reporting Council might only play an indirect role in regulating stablecoins.

He added that the regulatory approach will likely mirror that of virtual banks—now referred to as digital banks—providing clarity on how licensed institutions should be audited and how their financial statements should handle confirmation, measurement, and disclosure requirements.