Market News

(Reuters) -Standard Chartered said on Friday that it has formed a joint venture with strategic partners to apply for a license to issue stablecoins in Hong Kong, days after the city's stablecoin legislation came into effect.

Stablecoins, a type of cryptocurrency designed to maintain a constant value, are usually pegged to a fiat currency such as U.S. dollar and are commonly used by crypto traders to move funds between tokens.

Anchorpoint Financial, a joint venture between Standard Chartered's Hong Kong branch, blockchain gaming developer Animoca Brands, and telecom firm HKT, has formally expressed interest to the Hong Kong Monetary Authority (HKMA) in applying for the licence, lender said in a statement.

Hong Kong in May passed a bill establishing a licensing regime for fiat-referenced stablecoin issuers, providing regulatory clarity for upcoming stablecoin issuers. The legislature went into effect on August 1.

The HKMA in a media briefing late last month said that it expected the first batch of stablecoin issuer licences to be granted early next year.

(Reporting by Kumar Tanishk in Bengaluru; Editing by Nivedita Bhattacharjee)