The financial markets witnessed a historic moment on June 24, 2025, as Guotai Junan International secured an upgraded license from Hong Kong's Securities and Futures Commission. This pivotal development allows clients to trade cryptocurrencies and stablecoins directly on its platform, marking a significant shift in the regulatory landscape.
At a critical juncture where regulation and innovation are in constant tension, Hong Kong has taken a proactive step by breaking the stablecoin regulatory deadlock. This move signals a forward-looking approach, indicating a transition from regulatory观望 to structured guidance for digital currencies. It also suggests an impending systemic transformation within the entire industry ecosystem.
The issuance of a "Digital Asset Service License" to stablecoin issuers within a legal framework is not an isolated policy action. Instead, it represents a strategic move in the global financial digitalization wave, injecting a Chinese solution into the restructuring of the global financial order through institutional innovation.
This leap from regulatory pilot to institutional construction has ignited market confidence, creating ripples across the capital markets. In the first half of the year, the A-share market's stablecoin index led with a 76% gain. During the three trading days from June 23 to 25, the popular Fintech ETF (159851) surged by 15.46%. By June 30, 2025, this ETF had achieved a remarkable 116.17% increase in net value over the past year, securing the top position among all index funds.
Why the Fintech ETF is Leading the Market
The outstanding performance of the Fintech ETF is closely tied to its underlying assets. With a 23% exposure to stablecoin-related concepts—the highest among all ETFs—it is uniquely positioned to benefit from this trend.
Stablecoin Innovations Reshaping Finance
Stablecoins have emerged as a global market hotspot this year. Circle, often referred to as the "first stablecoin stock," saw its shares surge by 750% within just 12 trading days after its IPO. Recent legislative developments in the United States and Hong Kong have introduced stablecoin bills, promoting healthier market growth.
Tech giants are also entering the stablecoin arena. Richard Liu, founder of JD.com, mentioned that the company is preparing to apply for stablecoin licenses in major currency countries. Ant International has also expressed intentions to submit license applications once relevant channels open.
On the surface, stablecoins represent financial innovation, but they are also a tool in the strategic competition among major economies. So, what exactly is a stablecoin? It is a type of cryptocurrency designed to maintain price stability by pegging its value to fiat currencies, commodities, or other assets.
Applications include cryptocurrency trading, cross-border payments, and real-world asset (RWA) transactions. In cross-border payments, for instance, stablecoins enable near-instant settlements and significantly reduce costs.
From a monetary perspective, stablecoins are driving competition and reshaping the international monetary system, becoming strategic instruments in the digital economy. Some scholars argue that this represents the most significant change in the global monetary system since the collapse of the Bretton Woods Agreement.
Currently, USD-denominated stablecoins dominate the market. According to DefiLlama data, as of July 1, 2025, there are 267 stablecoins globally, with a total market capitalization exceeding $253.874 billion. USDT ($158.754 billion) and USDC ($61.219 billion) together account for 86% of the total stablecoin market share.
Hong Kong's pioneering stablecoin regulations and pilot programs have led analysts from Everbright Securities to suggest that stablecoins could serve as an on-chain pivot for the internationalization of the Chinese yuan. If offshore yuan-backed stablecoins are issued in Hong Kong or other regions, they could provide a new pathway for yuan internationalization.
Although the hegemony of the US dollar remains challenging to overturn, the rule restructuring in the blockchain field offers the possibility of "changing lanes" for yuan internationalization. By expanding use cases and embedding into global payment networks, stablecoins could reshape the international monetary competition landscape amid ongoing transformations.
The stablecoin trend has also impacted the A-share market, with related概念 stocks soaring. For instance,四方精创's stock price surged by 210% in the first half of the year, while恒宝股份,翠微股份, and京北方 all saw their stock prices double.
This wave of growth propelled the Fintech ETF (159851) to an 18.64% gain in June, ranking among the top performers in the market.
116.17% Surge: Fintech ETF Tops the Charts
Across the ETF landscape, the Fintech ETF (159851) has delivered an impressive 116.17% return over the past year, claiming the top spot on the ETF performance charts. During the "9·24 rebound" last year, its net value surged by 123% in just 32 trading days.
Historically, the fintech sector has often acted as an "amplifier" during bull markets, demonstrating high elasticity and sensitivity to improvements in liquidity. This elasticity stems from inherent advantages: the beta attributes of internet brokers and the pro-cyclical nature of financial IT converge here perfectly.
During bullish cycles, internet brokers experience near-exponential profit growth, while financial IT providers benefit from increased investments by brokers. This is not merely a sector rotation but a revolution in financial practices driven by technological empowerment.
Currently, the market is undergoing an epic migration of capital. In May, the one-year fixed deposit rate fell below 1%. CITIC Securities noted in an article that we are in the first half of a rate-cutting cycle, and with the trend of declining interest rates, moving away from "interest dependence" is a necessary adjustment for individuals.
The article suggests two changes: learning to embrace volatility and take on risk, and broadening the perspective on diversified asset allocation. Deposit-based wealth management is gradually being replaced by diversified asset allocations.
Lu Zhe, chief economist at Soochow Securities, pointed out that Chinese residents' property income is relatively singular, primarily relying on deposit interest. About 80% of domestic property net income comes from interest, while only 10% comes from corporate dividends. In contrast, the average dividend share in 38 other countries reaches 55%.
As domestic residents' ¥160 trillion in deposits seek outlets, the capital market becomes one of the containers for this flood. Capital never sleeps; it only flows in the direction of least resistance.
Jinxin Futures believes that the A-share market is currently experiencing a triple驱动 of economic recovery, declining interest rates, and deposit migration. The Shanghai Composite Index breaking through 3,400 points signals the opening of a new upward space, with the historic turning point in residents' wealth allocation resonating with the global easing cycle.
By June 30, 2025, the trading volume on the Shanghai and Shenzhen stock exchanges had exceeded ¥1 trillion for 23 consecutive trading days. The total market capitalization of the A-share market rose to ¥100.02 trillion, up 6.5% from the end of 2024.
Bolstered by the stablecoin boom and market liquidity, the Fintech ETF (159851) saw net inflows of ¥714 million in the past 10 trading days as of July 1, 2025. Its average daily turnover in June reached ¥751 million, and its latest size reached ¥5.731 billion by June 30, continuously setting new records. Its appeal, liquidity, and scale all rank first by a wide margin among similar指数 products.
The Fintech ETF (159851) and its feeder funds (Class A: 013477; Class C: 013478) track the CSI Fintech Theme Index. This index comprehensively covers popular themes such as AI applications, internet brokerage, Huawei HarmonyOS, financial IT, and信创, combining technological innovation with financial attributes. Its top weightings include industry leaders like东方财富,同花顺,恒生电子,润和软件,指南针,新大陆,东华软件,四方精创,银之杰, and拉卡拉.
Historical Echoes and Future Prospects
As the net value curve of the Fintech ETF breaks through historical limits, we are witnessing not just a capital market狂欢 but a transformative era reshaping human civilization.
Looking back at history, those business legends that rose with the tides of time all demonstrated a profound insight into the direction of progress. The Rockefeller family expanded into the energy sector by investing in oil pipelines during the transition from the steam age to the electrical age. Jeff Bezos built an e-commerce and cloud computing empire by focusing on cloud data as the internet颠覆 the world. Their successes were not accidental but arose from a deep understanding of时代 trends.
Now, at the convergence of a new technological revolution, what is needed is not blind worship of technology but a清醒认知 of the era. As the spotlight shines on this critical node, individual choices matter, but the fundamental choice is whether one stands on the right side of history.
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Frequently Asked Questions
What is a stablecoin?
A stablecoin is a type of cryptocurrency designed to minimize price volatility by pegging its value to a stable asset, such as a fiat currency or commodity. This makes it suitable for transactions, cross-border payments, and as a store of value in the digital economy.
Why is Hong Kong's stablecoin regulation significant?
Hong Kong's move to regulate stablecoins within a legal framework signals a shift from观望 to active guidance, promoting market health and innovation. It positions Hong Kong as a pioneer in digital asset regulation and could facilitate the internationalization of the Chinese yuan through offshore stablecoin initiatives.
How does the Fintech ETF benefit from stablecoin trends?
The Fintech ETF has high exposure to stablecoin-related concepts, with 23% of its index weight in this area. As stablecoins gain adoption and regulatory support, companies within the ETF's portfolio—such as financial IT providers and internet brokers—stand to benefit from increased demand and investment.
What risks are associated with investing in fintech and stablecoins?
Investments in fintech and stablecoins are subject to market volatility, regulatory changes, and technological risks. It's essential to conduct thorough research, understand the underlying assets, and consider diversified investment strategies to mitigate potential losses.
How are interest rates affecting the fintech market?
Declining interest rates are driving investors away from traditional deposits towards higher-yielding assets, including fintech ETFs. This migration of capital is amplifying liquidity in the sector, contributing to the impressive performance of financial technology investments.
Can stablecoins challenge the US dollar's dominance?
While USD-backed stablecoins currently dominate, the emergence of other currency-backed stablecoins—such as those pegged to the Chinese yuan—offers alternative pathways for internationalization. However, challenging the dollar's hegemony will require widespread adoption and regulatory support across global markets.