From the perspective of JD.com's structure, what kind of enterprises can issue stablecoins in compliance?

JD can deliver because it is sufficiently 'like Hong Kong'.

Written by: Portal Labs

On May 21, 2025, the Hong Kong Legislative Council passed the "Stablecoin Ordinance Bill", paving the way for the compliant issuance of stablecoins in Hong Kong. Consequently, the Web3 market, especially in China (Mandarin-speaking), is turning its attention to the internet giants participating in the sandbox program.

Since June, discussions about stablecoins have been ignited in China, led by JD.com. On June 17, according to Sina Finance, JD.com's Liu Qiangdong stated that JD.com hopes to apply for stablecoin licenses in all major currency countries worldwide to facilitate currency exchange between global enterprises. On the 18th, JD Coin Chain Technology CEO Liu Peng mentioned in an interview with Bloomberg Businessweek that the Hong Kong dollar and multiple stablecoins have been successfully tested in the Hong Kong Monetary Authority’s "sandbox" and are expected to officially obtain licenses and go live in early Q4 of this year.

As always, whenever there is favorable news from Hong Kong, there are always many voices of "domestic opening signals" in the mainland, and this time is obviously no exception. However, while hopes can exist, as practitioners, Portal Labs still believes that we should look beyond the surface and examine the underlying logic.

So, why can JD.com, as a Chinese internet giant, issue stablecoins? This must be because its underlying architecture meets the conditions for issuing stablecoins in Hong Kong. (That's right, not China, just Hong Kong)

From the composition of the project itself, its compliance path, initiating entity, and business positioning are all very clear.

JD Stablecoin Project Entity

The reason JD can promote the stablecoin project in Hong Kong is that its underlying architecture must meet the basic requirements of the Hong Kong stablecoin regulations for the "issuer entity." According to the Hong Kong "Stablecoin Regulation Draft," the issuer must:

• Registered in Hong Kong;
• Has a paid-up capital of over HKD 25 million;
• Possess stable financial and risk control capabilities;
• Can maintain a 100% high-quality, highly liquid asset reserve;
• Accept auditing supervision and establish a clear redemption mechanism.

The establishment of JINGDONG Coinlink Technology Hong Kong Limited is precisely to meet the regulatory framework's institutional requirements. The company is registered in Hong Kong, with JD Technology Group as the shareholder, possessing independent legal entity status, which allows for financial, asset, and business separation from the parent company. This structural arrangement not only ensures that it meets the basic qualifications of an issuer but also guarantees that its business operations can independently carry out compliance responses during sandbox testing, risk assessment, and formal licensing processes.

From a compliance perspective, why doesn't JD Group directly apply for a license? The reason lies in the fact that JD, as a large mainland group, cannot directly become a "locally registered issuer" under Hong Kong's stablecoin regulations. By establishing a wholly-owned subsidiary, the group can achieve unified coordination in technology and resources while independently being subject to the supervision of the Hong Kong Monetary Authority, thus completing the legal relationship between the issuer and reserve custody, as well as compliance reporting.

This arrangement is essentially no different from Circle establishing Circle Internet Financial LLC in the United States as the issuer of USDC: the "issuer" must have an independent and auditable legal identity to comply with local regulations and business penetration requirements, rather than relying on the overall qualifications of the parent company.

In other words, JD is qualified to participate in the stablecoin sandbox not because it is "in China," but because it is "in Hong Kong and meets the regulatory requirements of Hong Kong." This is the first principle of the project's establishment and a prerequisite for judging whether it can be replicated.

JD Stablecoin Project Design

Meeting the regulatory qualifications is merely the starting point for the compliant issuance of stablecoins. The real key to being "able to issue" lies in the design capability—whether an institution can build a stablecoin issuance and operational system that is regulated, auditable, and redeemable.

This capability is often reflected on three levels: governance structure, financial capacity, and infrastructure.

Governance Structure: From Group Separation to Independent Risk Control System Arrangement

According to the Hong Kong "Stablecoin Regulation Draft", issuers must meet a series of regulatory requirements at different governance levels: including establishing internal audits, risk control, and information disclosure mechanisms, as well as clarifying the boundaries of directors' responsibilities and legal regulatory obligations. The purpose is to regard issuers as quasi-financial institutions, subjecting them to scrutiny under a transparent governance structure.

The reason why JD Coin Blockchain Technology can become a pilot sandbox institution is not primarily because its parent company is an internet giant, but because it possesses a governance structure of a "quasi-financial issuer". According to public information, the company has an independent director structure in its legal documents and complies with local Hong Kong laws for financial report audits and daily regulatory submissions. This means that its issuance activities do not rely on the guarantees or reputation of the parent group, but rather undertake legal responsibilities based on its "own governance system".

Funding Structure: Behind the Compliance Reserve Mechanism and High Credit Threshold

The regulatory requirements for stablecoin reserves in Hong Kong are extremely strict: not only must they be 100% pegged, but they must also consist of "high-quality and highly liquid assets," such as Hong Kong dollars, bank deposits, and short-term government bonds, and a dedicated custody account must be established for asset isolation and auditing.

This threshold naturally excludes a large number of small and medium-sized crypto projects, leaving only financially robust enterprises with strong financial risk control capabilities capable of meeting it. As a large enterprise with abundant daily cash flow, JD.com has the ability to set up equivalent reserve accounts and collaborate with financial institutions for asset custody. It is understood that during the sandbox testing period, it has established a mechanism for the exchange and redemption of stablecoins and has promised users that they can redeem fiat currency "at face value, with no additional fees," which aligns with the basic requirements in the draft.

More importantly, its stablecoins are not anchored to virtual assets, but are collateralized by Hong Kong dollars or multiple currencies, further enhancing regulatory acceptability. The risk exposure behind this type of reserve mechanism is relatively controllable, which clearly distinguishes it from solutions based on "algorithms" or "on-chain collateral" in the cryptocurrency market.

Infrastructure capabilities: Can it independently complete clearing, verification, and compliance?

Issuing stablecoins is not a technological innovation, but a reconstruction of "compliant financial facilities." Within the regulatory framework of the Monetary Authority, issuers must possess a clearing and settlement system, identity verification processes, KYC/AML mechanisms, system auditing, and emergency response capabilities. In short, stablecoins cannot simply be issued by writing a smart contract and setting up a front end; it is a complete system engineering.

In this regard, JD.com has accumulated rich experience in B-end scenarios such as e-commerce payments, consumer finance, and cross-border settlements. Its subsidiary JD Technology has previously built multiple payment and account systems, capable of operating millions of financial users. This provides a natural infrastructure foundation for stablecoins. In other words, what JD.com issues is not a "token on the chain," but a type of "financial instrument" with a real exchange mechanism.

In contrast, many crypto-native projects, even if they have licenses overseas, find it difficult to establish the supporting infrastructure in actual operations, thus failing to meet the core requirement of the Hong Kong regulator for "full process controllability of the stablecoin system."

JD Stablecoin Business Scenarios

The core requirement of regulation is not just "can you issue it," but also "once you have issued it, can it operate within the regulatory view." From this perspective, the use cases for stablecoins are not only about commercial expansion logic but also serve as a bridge of regulatory trust.

At this point, JD's stablecoin project is clearly positioned to "serve cross-border remittances and corporate payments," with the entry point being the existing business system in reality, rather than rebuilding a new on-chain ecosystem. This approach, which starts from "the extension of existing systems," precisely aligns with the regulatory tone emphasized by the Hong Kong Monetary Authority of "integrating with the real economy."

Enterprise Payment: Not creating a C-end wallet, but developing a B-end settlement tool.

The JD stablecoin project is a B2B-level settlement tool. According to CEO Liu Peng's statement in a Bloomberg interview, its goal is to provide corporate clients with more efficient exchange methods between different national fiat currencies, reducing the intermediate links and exchange loss costs in traditional cross-border settlements.

This means that the primary function of the JD stablecoin is to enhance "enterprise foreign exchange efficiency". Its circulation path is naturally closed, making it clear and controllable for users. From a regulatory perspective, this high-certainty scenario is highly acceptable: it does not involve speculation, is not aimed at retail investors, and has controllable risks and clear purposes—exactly the ideal "fintech enhancement tool" rather than a "quasi-financial asset."

Off-chain connectivity: Integration with existing supply chain finance and cross-border settlement closed loops

JD has already laid out systems such as supply chain finance, cross-border clearing and settlement, and warehousing fulfillment in its cross-border business. The integration of stablecoins is actually a natural extension of the "on-chain certificate + off-chain fulfillment" logic. Compared to most Web3 projects on the market that "issue tokens first and then find scenarios," JD itself has a demand side, which naturally generates use cases for stablecoins.

In other words, JD's stablecoin is not created simply for the sake of creation, but to address the pain points of currency circulation in the existing system: lack of transparency in multi-currency settlement, high transaction fees, and unstable arrival times. In this system, stablecoins are not a flashy gimmick for the C-end, but a means to improve efficiency for the B-end.

Regulatory Friendly: Clear scenario paths, user verifiable, predictable returns

Compared to many stablecoin models that construct "anchoring relationships" through DeFi protocols and contract mechanisms, what JD provides is a commercial application path that is "disclosable, reportable, and controllable."

Its goal is not to build liquidity pools or token markets, but to clearly explain to regulators: which company this stablecoin is issued to, what scenario it is used for, and how it is settled after use. Every step of the process includes KYC, auditing, and traceability mechanisms. To some extent, it is more akin to a "on-chain settlement certificate operating on a regulatory map," rather than a freely traded market asset.

Conclusion

The JD stablecoin project has proven one thing: in today's world where stablecoins are entering institutional frameworks, the project's "structural adaptability" is becoming the core variable that determines success or failure.

It's not about who launched the coin first, nor who understands smart contracts better, but about who can build a complete framework that is accepted by regulators, validated by scenarios, and recognized by the market. This framework is not imagined through a white paper, but must be grounded in:

• Localized issuers and reserve isolation accounts;
• A clearing and settlement system and risk control mechanism that meets financial-grade requirements;
• A clear value closed loop for scenarios, especially the real needs of the B-end.

In other words, future stablecoins are not an "extension of crypto projects" but rather a "new journey for infrastructure-level enterprises."

Portal Labs believes that the real good news will not come in the form of "regulatory easing," but will gradually be released in the form of "institutional stability + rising compliance capabilities."

For companies looking to enter this field, the first question they should ask themselves is: Am I ready to become a financial issuer?