Hong Kong’s foray into stablecoins has run into some early hiccups with regulators having to issue public warnings regarding unauthorized tokens using the names of newly licensed issuers. The Hong Kong Monetary Authority has issued a public alert after tokens bearing the tickers ‘HKDAP’ and ‘HSBC’ began circulating, falsely implying ties to regulated entities. The alert comes soon after the city’s decision to grant its first stablecoin licenses to HSBC and Anchorpoint Financial, a milestone in Hong Kong’s broader digital asset strategy.
Both entities have denied issuing regulated stablecoins in the market.
Regulator flags unauthorized tokens
In its statement, the HKMA said the tokens were launched without approval and have no connection to licensed issuers. The regulator asked the public to remain cautious, adding that they should only deal with stablecoin related products which have official confirmation from issuers.
The announcement shared on Tuesday said, “Tokens with tickers “HKDAP” or “HSBC” have been launched, but they are not issued by or otherwise associated with licensed stablecoin issuers.”
The statement alerts the public to do due diligence when dealing with digital tokens. “Members of the public should stay vigilant against fraudulent activities or scams that are purported to be associated with the licensees or their stablecoin issuance.”
HKMA also advises the public to follow information shared on official channels.
“If in doubt, members of the public should refer to the official announcements of the two licensees. When acquiring or using stablecoins, members of the public are reminded to do so only through regulated channels.”
This incident is not a one-off. This forms a familiar pattern in crypto markets, where high-profile announcements create an opening for bad actors to exploit brand recognition. Tokens that appear linked to legitimate financial institutions often carry an implied sense of regulatory approval, which misguides retail investors in the absence of a well established regulatory landscape and complete information.
Issuers deny any involvement
Following the incident coming to light, both HSBC and Anchorpoint Financial moved quickly to issue clarifications. HSBC confirmed that it has not yet launched any stablecoin product in Hong Kong. The bank said it intends to roll out a Hong Kong dollar-denominated token later this year, with distribution expected through its PayMe platform and the HSBC HK mobile app.
Anchorpoint Financial also denied any association with tokens using the ‘HKDAP’ ticker. The firm has previously outlined plans for a phased rollout of its stablecoin beginning in the second quarter of this year. Anchorpoint’s infrastructure has amplified the attention to the incident. The venture brings together Standard Chartered, Animoca Brands and Honk Kong Telecommunication, positioning it as one of the most closely watched entrants in Hong Kong’s regulated stablecoin market.
A litmus test for Hong Kong’s regulatory framework
This episode comes at a crucial moment for Hong Kong’s digital asset ambitions. Since releasing its crypto roadmap in 2022, the city has moved to establish a structured environment for virtual assets, including licensing regimes for exchanges and a dedicated framework for stablecoin issuance. A key component of that effort has been the HKMA’s 2024 sandbox program which allows prospective issuers to test stablecoin models under regulatory supervision before full deployment.
The emergence of counterfeit tokens so soon after licensing has thrown up a dual challenge for the regulators. On the one hand, Hong Kong is attempting to position itself as a compliant hub for institutional-grade crypto activity. On the other, it must contend with the persistent risks of fraud and misinformation that continue to plague the sector.