From JD.com's architecture, which types of enterprises are eligible to issue stablecoins in compliance with regulations?
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From JD.com's architecture, which types of enterprises are eligible to issue stablecoins in compliance with regulations?
JD.com can deliver because it's sufficiently "like Hong Kong."
Navigating Web3 tides with focused insightsAuthor: Portal Labs
On May 21, 2025, Hong Kong's Legislative Council passed the *Stablecoin Bill*, paving the way for compliant issuance of stablecoins in Hong Kong. Following this development, the Web3 market—particularly the Chinese (Mandarin-speaking) market—has turned its attention to major internet companies currently participating in the regulatory sandbox program.
Since June, news related to JD.com’s stablecoin initiatives has sparked widespread discussion within China. On June 17, according to Sina Finance, JD.com founder Richard Liu stated that JD aims to apply for stablecoin licenses in all major currency jurisdictions globally, enabling seamless foreign exchange between enterprises worldwide. The next day, Liu Peng, CEO of JINGDONG Coinlink Technology, revealed in an exclusive interview with *Bloomberg Businessweek* that the Hong Kong dollar and multi-currency stablecoins are progressing smoothly through testing in the Hong Kong Monetary Authority’s (HKMA) regulatory sandbox, with plans to officially obtain licensing and launch in early Q4 of this year.
As always, whenever positive developments emerge from Hong Kong, voices claiming “this signals mainland liberalization” quickly surface domestically—and this time is no exception. However, while hope is understandable, as industry practitioners, Portal Labs maintains that we must look beyond appearances and examine the underlying logic.
So why can JD.com, a Chinese internet giant, issue a stablecoin? The answer lies solely in the fact that its foundational architecture meets Hong Kong’s requirements for stablecoin issuance. (Yes, not mainland China—only Hong Kong.)
In terms of project structure, its compliance pathway, initiating entity, and business positioning are all clearly defined.
Jingdong Stablecoin Project Entity
The prerequisite for JD.com to advance its stablecoin project in Hong Kong is that its underlying structure must satisfy the basic requirements set by Hong Kong’s *Stablecoin Bill* for an "issuing entity." According to the draft bill, issuers must:
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Be incorporated in Hong Kong;
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Maintain paid-in capital of at least HK$25 million;
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Demonstrate sound financial health and risk management capabilities;
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Maintain 100% reserves in high-quality, highly liquid assets;
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Be subject to audit oversight and establish a clear redemption mechanism.
JINGDONG Coinlink Technology Hong Kong Limited was established precisely to meet these regulatory framework requirements. Registered in Hong Kong and wholly owned by JD Technology Group, it operates as an independent legal entity, allowing full separation from its parent company in terms of finance, assets, and operations. This structural arrangement not only satisfies the minimum eligibility criteria for issuers but also enables independent compliance responses throughout the sandbox testing, risk assessment, and formal licensing processes.
From a compliance perspective, why doesn’t JD.com apply directly under the main group? The reason is that JD, as a large mainland-based corporation, cannot directly qualify as a “locally incorporated issuer” under Hong Kong’s stablecoin regulations. By establishing a wholly-owned subsidiary, the group can maintain centralized coordination of technology and resources while fulfilling the requirement of having a legally distinct entity subject to supervision by the Hong Kong Monetary Authority—ensuring proper statutory relationships among the issuer, reserve custodian, and compliance reporting bodies.
This approach is fundamentally identical to Circle’s model of using Circle Internet Financial LLC as the USDC issuer in the U.S.: the “issuer” must be a legally distinct, auditable entity capable of meeting jurisdictional regulatory scrutiny and operational transparency, rather than relying on the parent organization’s overall reputation or creditworthiness.
In other words, JD qualifies not because it is “from China,” but because it is “in Hong Kong and complies with Hong Kong’s regulatory standards.” This is the first principle behind the project’s legitimacy—and the essential precondition for assessing whether such a model can be replicated.
Jingdong Stablecoin Project Design
Meeting the issuer eligibility criteria set by regulators is merely the starting point for compliant stablecoin issuance. True capability—"the ability to issue"—lies in whether an institution can build a regulated, auditable, and redeemable stablecoin issuance and operation system.
This capacity typically manifests across three dimensions: governance structure, financial strength, and infrastructure.
Governance Structure: Institutional Arrangements from Corporate Separation to Independent Risk Control
Under Hong Kong’s *Stablecoin Bill*, issuers must fulfill various governance-level regulatory requirements, including establishing internal audit, risk control, and information disclosure mechanisms, as well as clearly defining directors’ responsibilities and statutory obligations. The intent is to treat issuers as quasi-financial institutions subject to transparent and traceable governance reviews.
The key reason JINGDONG Coinlink Technology qualifies as a sandbox participant is not simply because its parent is an internet giant, but because it itself possesses the governance framework of a “quasi-financial issuer.” Public records indicate that the company includes independent directors in its legal documentation and conducts financial audits and routine regulatory reporting in accordance with Hong Kong law. This means its issuance activities do not rely on guarantees or reputational backing from the parent group, but instead assume legal responsibility through its own governance system.
Capital Structure: Behind the Compliance Reserve Mechanism and High Credit Threshold
Hong Kong’s regulatory requirements for stablecoin reserves are extremely stringent: not only must they be fully backed 1:1, but the backing must consist of “high-quality, highly liquid assets,” such as Hong Kong dollars, bank deposits, or short-term government bonds, held in segregated custodial accounts subject to auditing.
This threshold naturally excludes most small- and medium-sized crypto projects, leaving only well-capitalized firms with strong financial risk controls capable of compliance. As a large enterprise with robust daily cash flow, JD has the ability to establish equivalent reserve accounts and collaborate with financial institutions for asset custody. It is reported that during the sandbox phase, the company has already implemented mechanisms for stablecoin conversion and redemption, committing to allow users to redeem fiat at face value without additional fees—aligning fully with the core requirements outlined in the draft bill.
More importantly, its stablecoin does not collateralize digital assets but is instead pegged to fiat currencies like the Hong Kong dollar or multiple currencies, further enhancing regulatory acceptability. Compared to algorithmic or blockchain-collateralized models prevalent in the crypto space, this type of reserve mechanism presents significantly more manageable risk exposure.
Infrastructure Capability: Ability to Independently Execute Clearing, Verification, and Compliance
Issuing a stablecoin is not a technological innovation—it is the reconstruction of a “compliant financial infrastructure.” Under the HKMA’s regulatory framework, issuers must possess clearing and settlement systems, identity verification procedures, KYC/AML mechanisms, system audits, and emergency response capabilities. In short, issuing a stablecoin involves far more than writing a smart contract and launching a frontend; it is a comprehensive system engineering effort.
In this regard, JD brings extensive experience from years of operating in e-commerce payments, consumer finance, and cross-border settlements. Its subsidiary, JD Digits, has previously built multiple payment and account systems capable of serving millions of financial users—providing fertile ground for stablecoin infrastructure. Put differently, what JD is launching is not just a “token on chain,” but a financial instrument with real-world redeemability.
In contrast, many native crypto projects—even those holding overseas licenses—struggle to build the necessary operational infrastructure, making them unable to meet Hong Kong regulators’ core requirement of “full lifecycle controllability” for stablecoin systems.
Jingdong Stablecoin Business Use Cases
Regulators care not only about “whether you can issue,” but more critically, “whether your stablecoin will operate within their supervisory scope after issuance.” From this angle, use cases are not just commercial expansions—they serve as bridges to regulatory trust.
JD’s stablecoin initiative explicitly targets “cross-border remittance and corporate payments,” building upon existing business systems rather than attempting to create a new on-chain ecosystem from scratch. This approach—extending from established systems—perfectly aligns with the HKMA’s emphasis on integration with the real economy.
Corporate Payments: Not Building C-end Wallets, But B-end Settlement Tools
The Jingdong stablecoin project functions at the B2B level as a settlement tool. As CEO Liu Peng explained in the Bloomberg interview, its goal is to provide enterprise clients with more efficient means of exchanging between different national fiat currencies, reducing intermediary steps and foreign exchange losses inherent in traditional cross-border settlements.
This implies that the primary function of the Jingdong stablecoin is to enhance efficiency in corporate foreign exchange, operating within a naturally closed circulation path where users are clearly identifiable and controllable. For regulators, such a high-certainty scenario is highly acceptable: it avoids speculation, does not target retail investors, carries low risk, and serves a clear purpose—making it an ideal example of a “financial technology enhancement tool” rather than a “quasi-financial asset.”
Off-chain Integration: Seamless Connection with Existing Supply Chain Finance and Cross-border Settlement Loops
JD already has established systems in supply chain finance, cross-border clearing, warehousing, and fulfillment within its international operations. Embedding stablecoins into these workflows represents a natural extension of the “on-chain token + off-chain execution” logic. Unlike most Web3 projects that follow a “launch token first, find use case later” path, JD already has demand-side infrastructure in place—enabling organic generation of stablecoin use cases.
In other words, JD’s stablecoin is not issued for the sake of issuance, but to solve real pain points in existing systems: lack of transparency in multi-currency settlement, high transaction fees, and unstable settlement times. Within this framework, stablecoins are not gimmicks for end consumers but efficiency tools for business clients.
Regulatory Friendliness: Clear Scenario Pathways, Verifiable Users, Predictable Revenue Streams
Compared to stablecoin models that rely on DeFi protocols or smart contracts to create “pegging mechanisms,” JD offers a commercially viable pathway that is “disclosable, reportable, and controllable.”
Its objective is not to build liquidity pools or token markets, but to clearly communicate to regulators: which enterprise receives the stablecoin, for what specific use case, how it will be settled afterward—with every step incorporating KYC checks, audit trails, and traceability. In many ways, it resembles an “on-chain settlement voucher operating within a regulatory map,” rather than a freely tradable market asset.
Conclusion
The Jingdong stablecoin project demonstrates one key truth: in today’s era where stablecoins are entering institutional frameworks, a project’s “structural adaptability” has become the decisive factor for success.
It’s no longer about who issues first or who understands smart contracts best, but about who can construct a complete architecture accepted by regulators, validated by real-world use cases, and recognized by the market. Such an architecture cannot be imagined into existence through a whitepaper alone—it must be grounded in:
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Locally incorporated issuing entities and segregated reserve accounts;
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Clearing and settlement systems and risk controls meeting financial-grade standards;
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Clearly defined value loops rooted in genuine B2B demand.
In short, future stablecoins will not be extensions of crypto-native projects, but new frontiers for infrastructure-grade enterprises.
Portal Labs believes that real opportunities will not arrive via regulatory loosening, but gradually unfold through “institutional stability coupled with rising compliance capabilities.”
For any enterprise looking to enter this space, the first question should be: Are we ready to become a financial issuer?
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