The global digital asset landscape is undergoing a pivotal transformation as major financial hubs like the United States and Hong Kong accelerate stablecoin legislation. This regulatory momentum has triggered a significant rally across cryptocurrency-related equities, with markets in both Hong Kong and mainland China witnessing sharp gains in digital currency-linked stocks.
On May 29, Hong Kong’s Legislative Council passed the Stablecoin Ordinance Bill, establishing a licensing regime for fiat-backed stablecoin issuers. This landmark move integrates stablecoins into Hong Kong’s formal financial regulatory framework, positioning the city as a key player in the Web3 and digital finance ecosystem. Around the same time, the U.S. Senate advanced the 2025 GENIUS Act, a procedural step toward federal oversight of dollar-pegged stablecoins—signaling growing institutional acceptance of digital assets.
👉 Discover how global regulatory shifts are unlocking new investment opportunities in digital finance.
Market Reaction: Digital Currency Stocks Soar
The market responded swiftly. In Hong Kong, ZhongAn Online P&C Insurance Co. (stock code: 6060.HK) surged 31.56% on May 29, closing at HK$21.05—nearly doubling from its April low of HK$9.54. The rally reflects investor confidence in ZhongAn’s strategic positioning within the emerging digital asset infrastructure.
ZhongAn Bank, in which ZhongAn Online holds a 43.43% stake, is Hong Kong’s first digital bank to offer reserve banking services for stablecoin issuers. It's also Asia’s pioneer in offering retail crypto trading services, placing it at the heart of the region’s blockchain ecosystem. Its deep ties with digital asset exchanges and stablecoin projects position it for future collaboration as regulations take shape.
In mainland China, the WIND Cryptocurrency Index jumped 7.66%, with multiple stocks hitting daily trading limits:
- Lakala, Xiongdi Technology, Sandbox Tree, and Tianyang Technology all surged 20%.
- Others including Newland Payment, Feitian Technologies, Hengbao, Shenzhou Information, Jingbei North, and Cuiwei Shares posted strong gains.
Notably, Langxin Group and GCL Energy also reached涨停 (daily limit-up) due to their association with RWA (Real-World Asset tokenization)—a rapidly growing sector where physical assets like invoices or energy projects are converted into blockchain-based tokens.
Both companies previously partnered with Ant Digital Technologies to complete RWA financings worth 100 million and 200 million RMB respectively, showcasing real-world adoption of blockchain in corporate finance.
The Strategic Push for Digital Monetary Sovereignty
Stablecoins—digital currencies pegged to fiat money or commodities—are increasingly seen as the bridge between traditional finance and the decentralized economy. With over $250 billion in circulation, most major stablecoins like USDT and USDC hold reserves primarily in short-term U.S. Treasuries, making them not only payment tools but also significant holders of sovereign debt.
“Stablecoins offer far greater efficiency than traditional banking systems,” notes Guohe Securities. “Cross-border transfers that take days via SWIFT can settle in minutes using stablecoins, with transaction fees often under $5.”
Hong Kong lawmaker Wu Jie Zhuang highlighted that the new legislation marks a critical step toward establishing Hong Kong as an international Web3 hub. By anchoring stablecoins to legal tender, the region asserts its claim over digital monetary sovereignty—the power to influence currency flow and financial infrastructure in the digital age.
Similarly, the U.S. sees stablecoins as both a tool for maintaining dollar dominance and a response to global de-dollarization trends. Clear regulation could pave the way for broader adoption in payments, remittances, and even government-backed financial innovation.
“Stablecoins are the gateway to decentralized finance,” states a Citibank report. “They provide a stable store of value without the volatility of native cryptocurrencies, while enabling faster, cheaper cross-border transactions.”
Yet challenges remain—concerns over reserve transparency, under-collateralization risks, and systemic vulnerabilities must be addressed through robust oversight.
👉 Learn how compliant digital asset platforms are shaping the future of global finance.
Institutional Investors Position Early in Digital Finance
While many investors wait for clarity, institutional funds have already begun positioning in digital asset-adjacent equities.
ZhongAn Online: A Rare Public Fund Bet
Despite being rarely held by active mutual funds, ZhongAn Online attracted attention in Q1 2025 when Guofu New Trend Fund, managed by Shen Zhuxi and Gao Yanyun, took a 9.40% stake, making it the fund’s fourth-largest holding—and the only actively managed public fund to do so.
Though earlier funds like Huatai-PineBridge New Economy Greater Bay Area and GF Financial & Real Estate精选 exited after short-term holdings, renewed interest suggests growing confidence in ZhongAn’s fintech and digital banking trajectory.
Langxin Group: AI Meets Blockchain
Langxin Group (300682.SZ) was heavily held by Chen Ying, Chief Investment Officer at Golden Eagle Fund Management, across three funds:
- Golden Eagle Core Resources: +277,000 shares
- Golden Eagle Science & Technology Focus: +97,000 shares
- Golden Eagle Emerging Ethnic Industries: New position of 177,000 shares
While Chen cites AI-driven growth in consumer electronics and vertical applications as primary drivers, Langxin’s involvement in RWA projects aligns it closely with blockchain infrastructure development.
Most other institutional holders are quantitative or index-enhanced strategies, indicating broader algorithmic recognition of its digital economy exposure.
JINGBEI North: Rising Institutional Favorite
Jingbei North (002939.SZ), an IT and business process outsourcing provider for financial institutions, saw multiple fund managers initiate positions in Q1:
- Zhai Xiangdong (China Merchants Advantage Enterprise): 6 million shares
- Nong Bingli (Invesco Great Wall Quality Growth): 5.17 million shares
- Hu Yibin (China AMC Media & Internet): 1.64 million shares
- Yang Fei (Penghua Innovation Drive & Penghua High-End Equipment): Over 1.67 million shares combined
- Additional positions from Wang Xin (CJFD Digital Economy) and Xiong Zheyong (China AMC Advanced Manufacturing)
The company reported record revenue in 2024, driven by its role in financial institution IT innovation (“Xinchuang”) projects. Its AI and big data products generated nearly 80 million RMB, up 65%, while smart customer service and precision marketing brought in over 820 million RMB.
Crucially, Jingbei North supports core banking system development—including credit management, cash management, and payment settlement—putting it at the backbone of digital financial infrastructure.
Social Fund Moves on Key Players
Though no mutual fund held Newland Payment—one of the so-called “Four Little Dragons” of China’s digital currency sector—at quarter-end, the National Social Security Fund 604 Portfolio increased its stake to 10 million shares, signaling long-term confidence in its role in digital RMB and payment ecosystems.
Frequently Asked Questions
Q: What is a stablecoin?
A: A stablecoin is a type of cryptocurrency designed to maintain a stable value by being pegged to a reserve asset like the U.S. dollar or short-term government bonds. It combines the speed and accessibility of digital currencies with reduced price volatility.
Q: Why are governments regulating stablecoins now?
A: As stablecoins gain traction in payments and finance, regulators aim to ensure financial stability, prevent money laundering, protect consumers, and maintain control over national monetary systems in the digital era.
Q: How do RWA projects work?
A: Real-World Asset (RWA) tokenization converts physical assets—like invoices, real estate, or commodities—into blockchain-based tokens. This enables fractional ownership, faster settlement, and improved liquidity.
Q: Are cryptocurrency-related stocks safe investments?
A: Like any sector, they carry risks including regulatory changes, technology shifts, and market sentiment. However, companies with strong fundamentals and real-world use cases—especially those tied to financial infrastructure—are better positioned for long-term growth.
Q: Can stablecoins replace traditional banking?
A: Not fully yet—but they’re transforming cross-border payments and remittances. With clearer regulation, stablecoins could become integral to banking infrastructure rather than replacements.
Q: Why did ZhongAn Online surge so sharply?
A: Its subsidiary ZhongAn Bank plays a foundational role in Hong Kong’s stablecoin ecosystem. As the first licensed digital bank supporting stablecoin reserves and retail crypto trading, it stands to benefit directly from new regulations.
👉 Explore regulated digital asset platforms powering the next era of finance.