Hong Kong-based firm IDA has secured $6 million in seed funding to accelerate the launch of its first fiat-referenced stablecoin.

IDA, a Hong Kong-based digital asset company, has raised $6 million in seed funding led by CMCC Global’s Titan Fund and Hashed to develop its first fiat-referenced and regulated stablecoin HKDA.

In a press release on Sept. 2, the stablecoin issuer announced that the funding round also saw participation from several other investors, including Hack VC, Anagram, GSR, and Protagonist, in addition to angel investors, such as Solana co-founder Raj Gokal. Additionally, IDA has partnered with blockchain foundations like Solana, Polygon, and Aptos in a bid to “foster HKDA’s interoperability, accessibility, resilience, and liquidity.”

The funds will support IDA’s efforts to engage with local regulatory bodies such as the Hong Kong Monetary Authority, as the firm anticipates significant growth in the stablecoin market, which it expects to expand to “over $3 trillion in the next five years.”

Sean Lee, co-founder and CSO of IDA, says HKDA is built on public blockchains and is expected to launch on testnet soon, with a mainnet release planned by year-end and regulatory approval targeted for early 2025. Eventually, IDA aims to expand its offerings beyond Hong Kong, targeting other U.S. dollar-pegged economies and other nations along the Belt and Road and Global South initiatives, the press release reads.

The funding round comes as the HKMA announced its stablecoin sandbox participants, who will begin testing digital currencies backed by fiat. The HKMA clarified that participants will not handle public funds or solicit investments during the initial sandbox phase.