Where To License a Stablecoin? A Board-Level Comparison of the EU, UK, Hong Kong, Singapore and US Regimes

Yiannos Ashiotis

11 minutes ago

14 min read

Pnyx Hill analysis, drawing on BIS Financial Stability Institute Brief No 33 (August 2026).

The Bank for International Settlements has published the first structured side-by-side of five major stablecoin regimes -MiCA, the UK's FSMA cryptoassets regime, Hong Kong's Stablecoins Ordinance, Singapore's SCS framework, and the US GENIUS Act. The differences are not cosmetic. They determine who may issue, what else the issuer may do, how a group must be structured, and how a token can be made available across borders. Other jurisdictions -including the United Arab Emirates (UAE), Switzerland, and several offshore centres -have their own, materially different regimes and are not covered by the BIS analysis. Here is what founders, boards and general counsel should weigh before choosing a jurisdiction.

By mid-2026, the question is no longer whether stablecoins will be regulated. Multiple jurisdictions now have a live or near-live framework for fiat-referenced payment stablecoins. The Financial Stability Institute's FSI Brief No 33, published by the Bank for International Settlements (BIS) in August 2026, compares five of them side by side: the European Union (EU), Hong Kong (HK), Singapore (SG), the United Kingdom (UK) and the United States (US) . The paper does not cover every relevant regime -the UAE's Central Bank Payment Token Services Regulation (PTSR) and the two federal financial free zones (Abu Dhabi Global Market (ADGM) and Dubai International Financial Centre (DIFC)), Switzerland's FINMA guidance, and several other jurisdictions sit outside its scope. This article works through the BIS comparison and then flags where the picture continues beyond it.

Five observations from the paper are relevant for anyone structuring a stablecoin business:

The five regimes converge on core issuance mechanics -and diverge sharply on everything else.
The choice between a bank issuer and a non-bank issuer determines the entire operating model, from group structure to product scope.
Entity-level restrictions do not stop at the issuer. They stop at the group boundary -a gap the BIS has explicitly flagged as a supervisory blind spot.
Cross-border reach is a licensing question, not a technology question. The US "designated country" regime, the Hong Kong Monetary Authority (HKMA) branch route, and Singapore's Singapore-only rule each dictate what "global stablecoin" can mean.
Jurisdiction choice has a material effect on cost, timeline and product perimeter, often as significant as the underlying commercial and technical design.

Pnyx Hill advises stablecoin issuers, banks and payment groups across these regimes and beyond. The firm is headquartered in the ADGM in Abu Dhabi, with additional hubs in Nicosia, Athens and Astana, and partner coverage in London, Hong Kong, Singapore and Washington D.C. The article walks through the BIS comparison, notes the material regimes outside its scope, and sets out the practical implications for licensing strategy, product design and group governance.

Pnyx Hill Regulatory Insights cover titled “Where To License a Stablecoin?” Supporting text compares EU, UK, Hong Kong, Singapore and US regimes, explaining what jurisdiction choice means for business model, group structure and cross-border reach. A navy and stone globe with gold token markers forms the background.

Where To License a Stablecoin: The Five Regimes at a Glance

Each of the five jurisdictions has settled on a different legal container for stablecoin regulation, and each has a different scoping trigger.

Jurisdiction	Legislative framework	Token category	Scope trigger
European Union	Markets in Crypto-Assets Regulation (MiCA), Regulation (EU) 2023/1114	Electronic Money Token (EMT)	Local incorporation, offering to EU customers, or pegging to an EU Member State currency
Hong Kong	Stablecoins Ordinance 2025	Specified stablecoin	Local incorporation, offering to Hong Kong customers, or pegging to the Hong Kong dollar (HKD)
Singapore	Single Currency Stablecoin (SCS) framework under the Payment Services Act	MAS-regulated stablecoin	Local incorporation of a Singapore-issued token pegged to SGD or a G10 currency; foreign issuance and foreign offers are outside the framework
United Kingdom	Financial Services and Markets Act 2000 (Cryptoassets) Regulation; Financial Conduct Authority (FCA) Policy Statement 26/10	Qualifying stablecoin	Local incorporation or offering to UK customers
United States	Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act	Payment stablecoin	Local incorporation or offering to US customers; after July 2028, only issuers licensed in "designated countries" may reach the US market

The five regimes differ on the reach of their scope triggers. MiCA can apply on incorporation, on customer offer, or on currency peg. Singapore's SCS framework is triggered only by local incorporation, and Singapore is the only regime in the BIS sample that expressly prohibits multi-jurisdictional issuance of the same token. The UK and US sit between these two on scope but diverge on group structure. Hong Kong is the only regime in the sample that allows foreign-incorporated banks to issue through a branch rather than a subsidiary.

The First Decision: Bank Issuer or Non-Bank Issuer?

The bank / non-bank distinction shapes the entire licensing path, and every regime treats it differently .

Locally incorporated issuer	EU	Hong Kong	Singapore	UK	US
Bank	No additional licence needed; notification only	Stablecoin-specific licence required, typically via a subsidiary	Stablecoin licence required; effectively a separate legal entity because SCS issuers cannot conduct other activity	Stablecoin licence required; must issue through a non-deposit-taking insolvency-remote subsidiary with distinct branding	Stablecoin licence required; insured depository institutions must issue through a subsidiary
Non-bank	Electronic Money Institution (EMI) licence required under MiCA and Directive 2009/110/EC	Stablecoin-specific licence required -even if another financial licence is held	Major Payment Institution licence required above SGD 5 million circulation threshold	FCA stablecoin authorisation required -even if another financial licence is held	Stablecoin licence required at federal or state level

Three practical takeaways matter for structuring:

The EU allows the broadest range of bank activities alongside issuance. A credit institution can issue an EMT directly from its deposit-taking entity, placing token liabilities alongside deposits, and can lend, provide custody and undertake proprietary trading under its existing banking authorisation subject to notification.
The UK and US require the greatest structural separation for bank groups. Deposit-taking institutions must issue through a ring-fenced subsidiary with distinct branding, to prevent customer confusion between deposits and stablecoins and to insulate the deposit book from stablecoin stress .
Hong Kong is the only regime in the sample open to foreign banks without a local subsidiary. A non-Hong Kong bank may issue a Hong Kong stablecoin through a licensed branch, without setting up a subsidiary, provided it obtains a stablecoin licence from the HKMA and satisfies the statutory bank authorisation criteria -an option not available to foreign non-banks.

Core Activities: Where the Regimes Actually Converge

Across all five jurisdictions, three core activities are treated as the essential business of a stablecoin issuer: issuing the token, managing and holding reserve assets, and redeeming at par. On these, the regulatory approaches are broadly aligned .

Divergences appear in three places -and each one is a live design decision for any issuer :

Design point	EU (MiCA)	Hong Kong	Singapore	UK	US (GENIUS)
Self-custody of reserves	Allowed with segregation	Not expressly addressed; qualified custodians expected	Prohibited -reserves must sit with permitted custodians	Prohibited for the general pool; 20% intragroup custody cap (FCA), no cap for Bank of England (BoE) systemic regime	Allowed with segregation
Fees on redemption	Prohibited except stress-event "liquidity fees"	Permitted if reasonable and cost-based	Permitted if reasonable and disclosed	Permitted if reasonable and cost-based	Permitted
Interest to holders	Prohibited (under review in the MiCA 2.0 consultation)	Prohibited	Effectively prohibited	Prohibited	Prohibited -extended by the Office of the Comptroller of the Currency (OCC) proposal to indirect payments via affiliates
Redemption timeline	"At any time" -continuous	Next business day	Up to five business days	End of next business day (non-systemic); 24 hours (BoE-systemic)	Timely -OCC proposes two business days
Minimum redemption amount	Not addressed	Not expressly prohibited	Permitted if reasonable and disclosed	Prohibited outright	One token minimum (OCC proposed)

Two lines matter strategically.

The EU treats redemption as a payment-instrument right -no fees, no minimums, at any time. That is a different construction from the US and UK regimes, where the redemption right exists but may be priced and rate-limited. Whether that is preferable depends on the use case: treasury and payment-rail models benefit from redemption predictability, while other business models may prefer the fee flexibility available under other regimes.

The no-interest rule is now near-universal, but the enforcement perimeter differs. The US OCC has extended the prohibition to affiliate-paid interest, catching coordinated group arrangements that would otherwise fall outside the issuer's balance sheet. This is precisely the group-perimeter problem discussed below.

Non-Core Activities: Where the Regimes Diverge

The most consequential differences between the five regimes concern what an issuer is allowed to do beyond issuance. The BIS paper identifies two broad models :

A restrictive model, which confines the issuer to a narrow perimeter through explicit prohibitions (Singapore) or a positive list of permitted activities (US GENIUS Act).

A constrained model, which does not prohibit diversification but requires separate authorisation or supervisory consent for each additional activity (EU, Hong Kong, UK).

The practical picture, for a non-bank issuer, is this :

Non-core activity	EU (EMI issuer)	Hong Kong	Singapore	UK	US
Lending	Conditional -only in connection with payment services under Directive 2009/110/EC	Requires HKMA consent	Prohibited	Requires separate FCA authorisation	Implicitly prohibited (not on positive list)
Staking	Conditional -ancillary to custody, requires Cryptoasset Service Provider (CASP) authorisation under MiCA	Requires HKMA consent and SFC virtual-asset framework compliance	Prohibited	Requires separate FCA authorisation	Implicitly prohibited
Proprietary trading	Prohibited for EMIs; permitted for credit institutions with notification	Requires HKMA consent	Prohibited	Requires separate FCA authorisation	Implicitly prohibited
Custody of third-party cryptoassets	EMIs may custody only their own EMTs; credit institutions may custody more broadly	Requires HKMA consent	Prohibited	Requires separate FCA authorisation	Implicitly prohibited

For bank issuers, these restrictions are largely superseded by the existing banking framework -lending, custody and proprietary trading are governed by the banking authorisation, not the stablecoin regime . In practice this means bank-affiliated issuers can conduct a wider range of adjacent activities than dedicated non-bank issuers, which is a relevant input to entity-model selection but not a recommendation on its own -bank models carry their own prudential, capital and governance burdens that non-bank models do not.

The Group-Structure Blind Spot

Every one of the five regimes imposes activity restrictions on the issuing entity only -not on the wider corporate group. Singapore's Monetary Authority (MAS) has made the position explicit: the ban on lending and staking applies to the MAS-regulated stablecoin issuer, but the same activities may be conducted by a sister company in which the issuer has no stake. The other four regimes reach the same result by silence.

For bank issuers, this gap is closed by consolidated supervision, intragroup exposure limits and operational resilience standards, which apply across the banking group regardless of where issuance sits .

For non-bank issuers, no equivalent group-wide framework applies. The BIS explicitly flags this as a supervisory concern:

Because activity restrictions reach only the issuer, they can be circumvented through the corporate structure, by relocating prohibited activities to sister entities or another group member outside the stablecoin regime. This suggests that stablecoin frameworks, or related prudential regimes, may need to extend some form of group-wide oversight for non-bank issuers.

What this means at a board level:

Group-oversight design is a strategic question, not a compliance afterthought. If a stablecoin issuer sits inside a group that also runs a crypto trading platform, a custody provider, a lending desk or a DeFi protocol, the issuer's regulator will look through the entity -even where the rulebook stops at the issuer.
Reputational contagion is the enforcement lever. The BIS notes that operational and reputational risks arising from non-core group activities can trigger redemption pressure on the issuer, forcing distressed liquidation of reserves .
The group perimeter is likely to tighten. MiCA is under review, the BoE has already applied group-adjacent expectations to systemic sterling stablecoins, and the OCC has extended the no-interest rule to affiliate payments .

In practice, retrofitting a group structure to a supervisor's concerns after authorisation is materially more expensive than designing to those concerns before filing.

Cross-Border Reach: Making a Stablecoin Available Everywhere

The BIS analysis makes clear that "global stablecoin" is not a technology capability -it is a licensing question. Four practical routes exist :

The MiCA passport. An EMT authorised in one EU Member State may be offered across all 27, subject to notification. For issuers whose primary target is the European market, MiCA provides single-authorisation coverage across the bloc; the choice among EU Member States (for example Cyprus, Malta, Ireland or Luxembourg) turns on regulator practice, cost and local ecosystem rather than legal scope.
The Hong Kong branch route. A foreign-incorporated bank may obtain a Hong Kong stablecoin licence through a Hong Kong branch -the only regime in the sample that allows this. For international bank groups already operating a Hong Kong branch, this can reduce the cost and time to market of Asian issuance compared with establishing a local subsidiary.
The US "designated country" regime. From July 2028, foreign-incorporated issuers may no longer issue stablecoins domestically in the US. Instead, foreign stablecoins may only be made available in US markets if issued in a country the US Treasury has designated as having a comparable regulatory regime, and if the issuer registers with the OCC and accedes to OCC supervision, holds sufficient reserves in a US financial institution, and complies with any reciprocity arrangement. Which foreign regimes obtain designation, and on what terms, will be a significant variable in stablecoin corridor design over the coming years.
Multi-jurisdictional (multi-issuance) architectures. Singapore prohibits them outright. The UK permits them but requires FCA reserve and prudential rules to apply to all fungible tokens, wherever issued. The BoE has separately flagged multi-issuance as unsuitable for systemic use. The EU, Hong Kong and US frameworks are silent -meaning affiliate structures that issue fungible tokens across jurisdictions remain possible but under-supervised, and the BIS is calling for that gap to be closed.

For most issuers, the practical answer is a hub-and-spoke design: a primary licence in the jurisdiction that best matches the target customer base, combined with a foreign-issuer strategy for the other regimes. The design should be built to withstand supervisory scrutiny at each node, not just at the primary licence.

Pnyx Hill graph explaining where the world's major stablecoing frameworks converge and where they don't

Beyond the Five: Other Regimes That Matter

The BIS paper is deliberately confined to five jurisdictions. Several others are materially relevant to a stablecoin licensing decision and are not covered by the analysis above.

United Arab Emirates -Central Bank PTSR. The Central Bank of the UAE (CBUAE) Payment Token Services Regulation, Circular No. 2/2024, is a services regulation covering issuance, custody and transfer, and conversion of payment tokens. It permits licensed Dirham Payment Tokens (four issuers currently approved) for general use, and gates Foreign Payment Tokens (USDT, USDC, PYUSD) into a narrow virtual-asset corridor. The final transition period ends on 30 September 2026. The PTSR is stricter than most international regimes on capital, reserves and yield, and its foreign-token perimeter is one of the sharpest in the world.
UAE financial free zones -ADGM and DIFC. Firms incorporated in the ADGM (regulated by the Financial Services Regulatory Authority, FSRA) or the DIFC (regulated by the Dubai Financial Services Authority, DFSA) sit outside the CBUAE PTSR for primary regulation. Both zones have their own fiat-referenced token and virtual-asset frameworks. However, where an ADGM or DIFC firm offers a stablecoin service to UAE residents, a CBUAE registration is required in parallel -a two-regulator perimeter that has no direct equivalent in the five BIS regimes.
Switzerland -FINMA guidance. Swiss stablecoin issuance operates under FINMA's stablecoin guidelines and the Financial Market Infrastructure Act framework, typically involving a banking or fintech licence and DLT-specific provisions.
Other centres. Bermuda's Digital Asset Business Act, the British Virgin Islands' VASP Act, Bahamas' Digital Assets and Registered Exchanges (DARE) Act 2024, and a range of other frameworks are in active use for stablecoin issuers, particularly where offshore group structures are involved.

The UAE -with the CBUAE PTSR operating alongside the ADGM and DIFC frameworks -is analysed in a separate Pnyx Hill article.

What This Means for Founders, Boards and General Counsel

Five decisions are worth making early, whether the target regime is one of the five in the BIS paper or a jurisdiction outside it:

Decide the entity model before the jurisdiction. Bank-affiliated, EMI, trust-company, or dedicated stablecoin subsidiary -each unlocks a different product surface and a different cost base.
Test the group perimeter against the BIS-flagged risks. If any group entity conducts lending, staking, custody, proprietary trading, or operates a crypto platform, the issuer's regulator will treat those activities as in scope for reputational and operational-risk purposes, even where the rulebook stops at the entity.
Design the redemption model to the most restrictive applicable regime. If you intend to passport into the EU, MiCA's "at any time, no fees" standard is the binding constraint. If you intend to be systemic in the UK, the BoE's 24-hour rule is the binding constraint. If your token will be offered to UAE residents, the CBUAE's one-business-day rule and no-yield prohibition apply.
Map the cross-border reach before filing. The US designated-country regime, in particular, will constrain foreign-issuer strategies from July 2028 onward. Waiting to see the Treasury's designations before designing the group is a mistake -the underlying framework has to be defensible on day one.
Build the governance package to supervisory expectations, not to statutory minimums. Every one of the five regimes leaves supervisory discretion around consent, ongoing conditions and systemic escalation. The board packs, risk appetite statements, reserve management framework, redemption playbook and group-oversight protocols should be built to the standard the regulator would want to see, not the minimum the statute requires.

How Pnyx Hill Helps

Pnyx Hill is a senior-partner-led regulatory advisory platform for stablecoin issuers, banks, payment institutions and digital-asset groups, headquartered in the ADGM in Abu Dhabi, with additional hubs in Nicosia, Athens and Astana, and partner coverage internationally. The stablecoin practice covers:

Licensing strategy -jurisdiction selection, entity model, group architecture, product-fit assessment, risk identification, and cross-border reach design across the multiple regimes (EU, UK, Hong Kong, Singapore, US GENIUS Act, UAE, ADGM, DIFC, Switzerland and other centres.
Licensing execution -regulatory business plan, financial projections, capital and reserve modelling, control-function structuring, applications, white paper drafting, and end-to-end regulator interaction until authorisation.
Governance, risk and compliance -board composition and terms of reference, risk appetite statement, reserve management framework, redemption and operational-resilience playbooks, group-oversight design in response to the BIS-flagged perimeter risks, and independent assurance / internal audit.

Enquiries: contact Pnyx Hill for a scoping conversation on jurisdiction selection, group restructuring or supervisory readiness.

Speak To An Advisor

FAQ

Which jurisdiction is best for a non-bank to issue a stablecoin?

There is no single answer -the choice depends on target market, product perimeter and group structure. In the EU, MiCA allows EMIs to issue an EMT without a bespoke stablecoin licence. In Asia-Pacific, Hong Kong permits adjacent activities with HKMA consent while Singapore prohibits them for MAS-regulated stablecoin issuers . In the UAE, the CBUAE PTSR imposes stricter capital and reserve rules and gates foreign tokens into a virtual-asset corridor. The right jurisdiction is the one whose scope, activity perimeter and cross-border reach match the business model.

Can a bank issue a stablecoin directly, or must it use a subsidiary?

It depends. The EU allows a credit institution to issue an EMT directly from its deposit-taking entity, subject to notification. Hong Kong requires a stablecoin licence, typically obtained through a subsidiary. Singapore effectively forces a separate legal entity because SCS issuers cannot conduct any other activity. The UK and US both mandate a ring-fenced, non-deposit-taking, insolvency-remote subsidiary with distinct branding.

What is the group-oversight risk the BIS paper is flagging?

Every stablecoin regime restricts what the issuer can do, but stops at the group boundary. For non-bank issuers, that means prohibited activities -lending, staking, proprietary trading, third-party crypto custody -can legally be conducted by sister entities in the same group. The BIS is calling for group-wide oversight to close that gap, and boards should expect regulators to move in that direction.

Can the same stablecoin be issued in multiple jurisdictions?

Only in some. Singapore prohibits multi-jurisdictional issuance of the same MAS-regulated token. The UK permits it but applies FCA prudential rules across all fungible tokens wherever issued. The EU, Hong Kong and US frameworks are silent, meaning affiliate multi-issuance structures remain possible but under-supervised. This is a live area of policy movement, particularly under the MiCA review and the US GENIUS Act designated-country regime.

What is the US GENIUS Act "designated country" regime?

From July 2028, foreign-incorporated stablecoin issuers may not issue in the US. Instead, their tokens may only be made available in US markets if the issuer is licensed in a country the US Treasury has designated as having a comparable regulatory regime, and if the issuer registers with the OCC, accedes to OCC supervision, and holds sufficient reserves in a US financial institution to meet US-customer liquidity demands. Which foreign regimes obtain designation will drive stablecoin corridor design for the rest of the decade.

What about the UAE and other jurisdictions outside the BIS paper?

The BIS analysis is confined to the EU, UK, Hong Kong, Singapore and US. The UAE -through the CBUAE PTSR, ADGM and DIFC frameworks -operates a materially different regime, including a strict foreign-token corridor, four licensed Dirham Payment Token issuers, and a two-regulator perimeter for free-zone firms offering services to UAE residents. Switzerland, Bermuda, the British Virgin Islands, the Bahamas and other centres also maintain relevant frameworks. A dedicated Pnyx Hill deep-dive on the UAE will be published as a companion piece.

Where does Pnyx Hill sit across these regimes?

Pnyx Hill is headquartered in the ADGM in Abu Dhabi, with additional hubs in Nicosia, Athens and Astana. The firm advises stablecoin issuers across all major regimes on the full licensing lifecycle -jurisdiction and entity-model strategy, application execution, and ongoing governance and supervisory readiness.