DBS Hong Kong CEO Sebastian Paredes warned that Hong Kong’s new stablecoin KYC and AML rules will largely block their use in onchain derivatives trading.
Hong Kong’s stablecoin regulatory framework limits their use for derivatives trading on blockchain networks, according to Sebastian Paredes, CEO of DBS Hong Kong.
According to a Friday report by local news outlet The Standard, Paredes said that Hong Kong regulations on stablecoin Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements will significantly restrict their use for onchain derivatives trading. He said the bank would monitor developments, but focus instead on building broader stablecoin capabilities in Hong Kong.
His comments followed the rollout of Hong Kong’s new stablecoin rules on Aug. 1. The rules immediately criminalized the promotion of unlicensed stablecoins and established a public registry of authorized issuers.
