Stablecoin Momentum Builds on Policy Tailwinds: Where Should Investors Look Next?

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The stablecoin sector is capturing renewed investor attention amid a wave of supportive regulatory developments across global financial hubs. In recent weeks, a surge in policy momentum—from Hong Kong’s updated digital asset strategy to landmark U.S. legislative progress—has reignited market optimism and driven strong performance among stablecoin-related equities.

Today, shares of firms linked to the stablecoin ecosystem rallied sharply, with Chutian Long posting a rebound涨停 (limit-up gain) and achieving three涨停s in seven trading days. Other notable gainers included Kechuang Information,格尔Software, Jingbei North, Xin’an Century, Meideng Technology, Langxin Group, and Changan Technology—all registering significant gains. Payment solutions provider LAKALA also saw strong upward movement, reflecting broad-based enthusiasm across the fintech and digital infrastructure space.

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Regulatory Catalysts Fuel Market Confidence

A major driver behind the latest market surge came from Hong Kong, where the government released its Hong Kong Digital Assets Development Policy Statement 2.0. In the announcement, Financial Secretary Paul Chan articulated a forward-looking vision for digital asset innovation, emphasizing real-world tokenization use cases and diversified application scenarios.

This updated policy framework signals Hong Kong’s intent to position itself as a leading hub for compliant digital finance, with stablecoins playing a central role in cross-border payments, asset tokenization, and institutional-grade blockchain applications.

Further reinforcing this trend, Guotai Junan International—the overseas arm of Guotai Haitong Group—announced it has received approval from the Securities and Futures Commission (SFC) of Hong Kong to upgrade its existing securities trading license. The enhanced license now permits the firm to offer virtual asset trading services, including cryptocurrencies like Bitcoin and Ethereum, as well as stablecoins such as USDT (Tether). Additionally, the firm can now provide investment advice related to digital assets.

This regulatory greenlight marks a pivotal step toward mainstream financial integration of digital assets in Asia, enabling traditional brokerage clients to access crypto markets through established, regulated channels.

Global Regulatory Progress Accelerates Adoption

Beyond Asia, regulatory clarity is also advancing rapidly in the United States. Recently, the U.S. Senate passed the so-called “Genius Act”—a bipartisan stablecoin bill that represents the first major crypto-focused legislation approved by the chamber. The bill aims to establish a federal framework for issuing and regulating dollar-backed stablecoins, enhancing consumer protection and systemic stability.

Meanwhile, Hong Kong’s Stablecoin Bill is set to take effect on August 1, 2025, introducing licensing requirements and reserve transparency rules for stablecoin issuers. These coordinated efforts across jurisdictions reflect a growing consensus: stablecoins are no longer niche instruments but critical components of the future financial infrastructure.

Circle’s Market Debut Sparks Investor Frenzy

Market sentiment received another boost from the explosive performance of Circle, the issuer of USD Coin (USDC), following its NYSE debut on June 5. Within just over ten days, Circle’s stock surged from its $31 IPO price to an intraday high of $298.99—a near tenfold increase—highlighting intense investor appetite for regulated exposure to the stablecoin economy.

While volatility has since moderated, the episode underscores the market’s recognition of stablecoins as foundational assets in the digital economy.

Why Stablecoins Matter: Bridging Traditional and Decentralized Finance

According to Zhongtai Securities, stablecoins serve essential functions as value storage, transaction media, and payment instruments. Due to their price stability—typically pegged to fiat currencies like the U.S. dollar—they act as a vital bridge between centralized financial systems and decentralized blockchain networks.

This dual compatibility positions stablecoins at the heart of emerging financial innovations. As中信 Securities notes, stablecoins connect digital assets with the real economy, combining price stability with seamless interoperability across blockchain infrastructures. With clearer regulations emerging worldwide, the industry is poised for compliant, scalable growth.

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Real-World Asset Tokenization: The Next Frontier

One of the most promising growth vectors for stablecoins lies in Real World Asset (RWA) tokenization. RWA involves converting tangible assets—such as real estate, bonds, commodities, or private credit—into blockchain-based tokens that can be traded efficiently using stablecoins as settlement rails.

申万宏源 Securities highlights that stablecoins already facilitate over $15.6 trillion in annual transaction volume, surpassing both Visa (119%) and Mastercard (200%) in payment throughput. Beyond speculative crypto trading, RWAs offer investors asset-backed security and greater transparency—making them more attractive to institutional participants.

For example, tokenized government bonds or commercial real estate can be fractionally owned and settled instantly using stablecoins, reducing settlement times from days to seconds and lowering counterparty risk.

As Guosheng Securities points out, stock tokenization may become the next major use case for stablecoins within the RWA ecosystem. By digitizing equity ownership on blockchains, companies could enable 24/7 trading, automated dividend distribution, and broader global investor access—all powered by stablecoin settlements.

Key Sectors Poised for Growth

CICC (China International Capital Corporation) identifies several industries likely to benefit from the expanding stablecoin ecosystem:

Frequently Asked Questions

Q: What are stablecoins and how do they maintain their value?
A: Stablecoins are digital currencies designed to minimize price volatility by being pegged to reserve assets like the U.S. dollar, gold, or other financial instruments. Most commonly, they are backed 1:1 by cash or cash-equivalent reserves held by regulated issuers.

Q: How are stablecoins used in everyday finance?
A: They’re widely used for cross-border remittances, international trade settlements, decentralized lending, and as a safe-haven asset in volatile crypto markets. Their fast settlement and low fees make them ideal for global transactions.

Q: Are stablecoins regulated?
A: Increasingly, yes. Jurisdictions like the U.S., EU, Singapore, and Hong Kong are implementing frameworks requiring reserve audits, licensing, and anti-money laundering compliance for stablecoin issuers.

Q: What is RWA and why does it matter for stablecoins?
A: RWA stands for Real World Assets—physical or traditional financial assets tokenized on blockchains. Stablecoins serve as the primary medium of exchange for these tokens, enabling instant settlement and fractional ownership.

Q: Can traditional investors participate in the stablecoin economy?
A: Yes. Through regulated platforms, brokerage accounts with crypto access (like Guotai Junan International), or investment products tied to tokenized assets, institutional and retail investors can gain exposure securely.

Q: Is the current rally in stablecoin stocks sustainable?
A: While short-term valuations may reflect speculative enthusiasm, long-term sustainability hinges on continued regulatory clarity, real-world adoption, and integration into mainstream financial workflows.

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Conclusion

With policy tailwinds strengthening globally—from Hong Kong’s strategic digital asset push to U.S. legislative milestones—the stablecoin ecosystem is transitioning from experimental phase to institutional-grade infrastructure. Backed by real reserves and integrated into regulated financial platforms, stablecoins are redefining how value moves across borders and markets.

For investors, the opportunity extends beyond speculative trading. The convergence of stablecoins, RWA tokenization, and financial digitization represents a structural shift in global finance—one where efficiency, transparency, and accessibility are built into the foundation.

As adoption accelerates through regulated channels, sectors including fintech infrastructure, banking IT, telecoms, and asset management stand to benefit significantly. Now is the time to understand where value will flow next in this evolving landscape.

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