The government in Hong Kong is gearing up to introduce a draft regulatory framework for stablecoin issuers, to bring some order to this growing sector.
This move has caught the eye of stablecoin providers, including Circle, the issuer of USDC.
Big plans for Hong Kong
Jeremy Allaire, co-founder and CEO of Circle identified Hong Kong as a priority market for expansion.
He mentioned that once the new regulations are in place, Circle is ready to ramp up its operations in the city.
At the inaugural Circle Forum held at the luxurious Four Seasons Hotel in Hong Kong, Allaire expressed enthusiasm about applying for a local license.
He also highlighted some of the perks that make Hong Kong attractive, such as same-day U.S. dollar settlements and its status as the largest capital market in the Asia-Pacific region.
New partnerships announced
During the forum, Circle also unveiled two exciting partnerships. The first is a memorandum of understanding with Hong Kong Telecom to explore blockchain-based loyalty programs. Imagine earning rewards for your phone plan that you can actually use.
The second partnership is with fintech company Thunes, for streamlining cross-border payments using USDC.
This collaboration could make sending money across borders faster and more efficient, which is something everyone can appreciate.
Business model
On another note, Circle made some adjustments to its fee structure for redeeming USDC tokens through its Circle Mint platform.
Gone are the days of unlimited no-fee redemptions. Since February, they’ve implemented a tiered fee system for transactions over $15 million.
Now, if you’re redeeming more than $2 million per day with near-instant settlements, there’s a fee of 0.03% per transaction.
But if you’re redeeming amounts that exceed $15 million, that fee increases to 0.1%. It’s a smart move by Circle to manage larger transactions while still providing a service that many find valuable.
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