
Hong Kong Cautious of ‘Stablecoins Frenzy’ As Two Detained in $146.5M Money Laundering Operation
The Hong Kong Monetary Authority (HKMA) has cautioned against the inflated excitement surrounding stablecoins and articulated apprehensions regarding stablecoin speculation within the marketplace. These concerns have arisen just prior to the implementation of Hong Kong’s stablecoin ordinance, effective from 1 August 2025.
Describing the ‘stablecoin frenzy’ as a misinterpretation, HKMA CEO Eddie Yue stated, “We must be vigilant against rampant speculation from both the market and public sentiment. Recently, certain developments have come to our attention.”
“Dialogue concerning stablecoins frequently emphasizes their revolutionary impact on conventional finance, particularly on payment mechanisms. Yet, when it comes time to transition from the theoretical and virtual to practical applications and specific frameworks, a noticeable disconnect will appear,” he remarked in his blog post dated 23 January 2025.
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Two Arrested by Hong Kong Customs Officers for Laundering $146.5 Million
As reported by the South China Morning Post on 24 July 2025, two men were apprehended by Hong Kong customs for the illicit transport of cash and questionable transactions, reportedly involving Tether stablecoin USDT.
“A spokesperson from the Customs and Excise Department indicated that an inquiry into the individuals revealed they were involved in smuggling cash out of the city,” the announcement story detailed. “According to a source, the suspects also engaged in transactions utilizing the stablecoin USDT in conjunction with traditional currency, leading officers to find the origin of the funds dubious.”
Tether is once again facing scrutiny for money laundering. Will this become the status quo?
Two individuals detained in Hong Kong over laundering HK$1.15 billion related to a stablecoin case
Suspects accused of laundering funds through transaction and cash-smuggling efforts #fintech #tech… pic.twitter.com/erDbplkyQ2
— Richard Turrin (@richardturrin) July 23, 2025
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Financial Secretary Validates Stablecoin Licenses to Launch in August
To establish the world’s first regulated framework for stablecoins, Hong Kong announced that the stablecoin ordinance will be enacted in August 2025. This decision follows the passage of the legislation by Hong Kong’s Legislative Council. It requires any entity or individual issuing a fiat-referenced stablecoin (FRS) or Hong Kong Dollar-pegged tokens within the jurisdiction to acquire licenses from the HKMA.
Only licensed organizations will be permitted to offer FRS, thereby granting retail investors access to stablecoins. The new regulations are intended to safeguard the public and investors. Furthermore, to reduce fraudulent practices, the ordinance restricts advertisements to licensed FRS issuers only.
If you were curious about the urgency of stablecoin legislation being expedited tonight…
Starting on August 1, 2025, Hong Kong
will introduce an offshore Renminbi (RMB) stablecoin initiative, aimed at boosting RMB usage in global commerce and solidifying Hong Kong’s status in the digital sphere… https://t.co/T5MX4pQlJ8 pic.twitter.com/DUew8iCUcf
— Subjective Views (@subjectiveviews) July 18, 2025
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Key Takeaways
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Concerns regarding stablecoins arose just days ahead of the enforcement of Hong Kong’s stablecoin ordinance.
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Hong Kong customs officials apprehended two individuals for smuggling cash and executing dubious transactions, inclusive of Tether stablecoin usage.
The article Hong Kong Warns Against ‘Stablecoins Craze’ As Two Arrested In $146.5M Laundering Bust was originally published on 99Bitcoins.