Stablecoins in Asia: Regulation, Reserve Economics and the Race to Scale

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Stablecoin regulatory frameworks are proliferating across Asia, but an issuer’s viability is about more than just regulation – it’s about economics. While rules and regulation serves as important safeguards, in practice they are a form of market design.

Rules on who may issue, what reserves must be held, how reserve income may be used, and how tokens are minted and redeemed will contribute towards which stablecoins become commercially viable. They will also determine which corridors can support liquidity, and which Asian currencies get a usable stablecoin that scales.

That makes issuer the economics of a stablecoin key. Stablecoin models rely heavily on reserve income to fund distribution, liquidity and operations. The model that works for a large US dollar stablecoin in a higher-rate environment may look very different for a Singapore dollar, Hong Kong dollar or other regional currency token with a smaller float, more limited secondary-market liquidity and lower yield. To assess whether local currency stablecoins can be useful, we must determine whether their economics allow them to be issued and distributed at scale.

Asia Pacific regulators are testing different models. Hong Kong has issued its first two stablecoin licences, while Singapore has proposed legislative amendments to enhance its framework. Japan already regulates fiat-referenced stablecoins, though the regime is evolving, and South Korea and Taiwan are moving towards their own dedicated frameworks. Meanwhile, Australia has a licensing model but is developing a more dedicated payments regime.This webinar will examine how regulatory design, reserve economics and robust technology governance will shape the next phase of stablecoin issuance in Asia.

Key Themes

• Issuer economics: How reserve income, distribution costs, float size and interest rate differentials determine whether a non-USD stablecoin can scale.

• Regulation as market design: How rules on issuer eligibility, reserve composition, redemption, income retention and distribution shape market viability.

• Hong Kong and Singapore: What follows from Hong Kong’s licensing path and Singapore’s proposed framework, including open questions on reserves, income and operational requirements.

• Securing the mint: Moving from theory to practice on technology risk, operational resilience, and the governance of minting, burning, and custody.

• Payment instrument or deposit substitute: Why banks, regulators and issuers frame stablecoins differently, and what it means for their participation.

• Corridor liquidity: Why the success of regional currency stablecoins may depend as much on who funds the rail as on who wants to use it.