For Hong Kong’s 3.3 million PayMe users, everyday transactions such as buying coffee or splitting bills with friends could soon involve stablecoins, with HSBC preparing to introduce the digital currency in the second half of this year.

That comes after HSBC Holdings, together with a Standard Chartered-led joint venture, became the first to obtain a stablecoin issuer licence from the Hong Kong Monetary Authority on Friday, marking a breakthrough in the city’s digital finance development.

HSBC, the biggest lender in Europe and Hong Kong, is looking to introduce stablecoins to its more than 7 million customers in the city by integrating them into its popular PayMe app and its Hong Kong mobile banking apps.

Anchorpoint Financial, a joint venture among Standard Chartered, local game software and venture capital firm Animoca Brands, and HKT Ltd, will initially focus on institutional investors but may consider retail usage later.

This means stablecoins in Hong Kong will not be confined to tech-savvy users but could become part of everyday transactions. Here is what you need to know about stablecoins, which are set to be rolled out in Hong Kong.

What is a stablecoin?