First Digital introduced the USD stablecoin as Hong Kong crypto regulations kick-off.
Today, First Digital Group announced the launch FDUSD, a USD stablecoin. The stablecoin is mined on Ethereum and BNB, with First Digital in talks with all major exchanges for listing, a spokesperson said in a statement.
According to First Digital, FDUSD is backed by high-quality reserves of cash and cash equivalents in regulated financial institutions in Asia and will be issued by First Digital Trust, a company registered under Hong Kong’s Trust Ordinance.
Statement from First Digital CEO
One of the requirements of Hong Kong’s Trust Ordinance is to keep all reserves in separate accounts, which prevents assets from commingling. According to Vincent Chok, CEO of First Digital, the launch of this stablecoin represents a major step forward in the company’s mission to provide a secure and efficient digital currency that helps with transactions of everyday people.
However, the stablecoin will not be available to retail users in Hong Kong after the launch. Regulators in Hong Kong stated that stablecoins should not be allowed for public trading by retail investors until the proposed regulations for this asset class are officially implemented in the region.
The Hong Kong Monetary Authority (HKMA) and one of its financial regulators are considering new regulations for stablecoins that require real-world asset backing, disallow algorithmic stablecoins and mandate separate transactions for issuers and virtual asset exchanges. It is not yet clear when these regulations will come into effect.
Binance CEO CZ shared the news that First Digital launched the USD-pegged stablecoin FDUSD on BNB Smart Chain and Ethereum.