Hong Kong licensed trust company, First Digital Group, announced today that it's launching a new USD pegged stablecoin, FDUSD, onto Binance Smart Chain. Issued on both Ethereum and BNB, the digital asset aims to bolster the crypto ecosystem with a reliable, regulated option for transactions.
First Digital has confirmed discussions with all major cryptocurrency exchanges about listing FDUSD, expanding the coin's accessibility and reach. The company's spokesperson reported this development to CoinDesk, emphasizing the group's strategic plan to secure a firm footing for FDUSD in the crypto market.
The company assures that FDUSD is underpinned by "high-quality reserves" of cash and cash equivalents, which are held in regulated financial institutions throughout Asia. The issuance of the stablecoin is overseen by First Digital Trust, a trust company registered under Hong Kong's Trust Ordinance, which sets a high standard for the management and protection of the assets backing the stablecoin.
As mandated by Hong Kong's Trust Ordinance, all reserves are maintained in segregated accounts, a measure that prevents the co-mingling of assets, enhancing the transparency and trustworthiness of the FDUSD stablecoin.
Vincent Chok, CEO of First Digital, stated, "The launch of this stablecoin represents a major stride forward in our mission to provide a secure and efficient digital currency that can be seamlessly integrated into everyday transactions."
However, as the stablecoin launches, it will not be readily available to retail users in Hong Kong. The region's regulators have expressed that stablecoins should not be permitted for public trading by retail investors until the proposed regulations for this asset class are officially implemented in the territory.
The Hong Kong Monetary Authority (HKMA), the special administrative region's central bank, and one of its financial regulators, is currently contemplating new regulations for stablecoins. As reported by CoinDesk in February, the forthcoming regulations could necessitate local incorporation, real-world asset backing (thereby disallowing algorithmic stablecoins), and separate operations for issuers and virtual asset exchanges.
The exact timeline for the implementation of these new regulations remains unclear. Nonetheless, the launch of FDUSD marks a significant step in the maturation of the digital assets market, signifying an increasing trend toward regulatory compliance and stability in the world of cryptocurrencies.