Hong Kong’s e-HKD Pilot Phase 2 Begins
Hong Kong commenced the second phase of its central bank digital currency pilot on Monday, aiming to test the commercial feasibility of its e-HKD.
The Hong Kong Monetary Authority (HKMA), the de facto central bank, announced that the project has been renamed Project e-HKD+ as it officially launched the second phase of the e-HKD pilot.
Under Phase 2, 11 groups of firms from various sectors have been selected to explore innovative use cases for e-HKD and tokenized deposits across three main themes:
- Settlement of tokenized assets
- Programmability
- Offline payments
The HKMA plans to conduct the second phase using an e-HKD sandbox, which will allow pilot participants to prototype and test various use cases. Notably, Hang Seng Bank, Aptos Labs, and Boston Consulting Group aim to assess the commercial value of settling a tokenized fund with digital currency on a public blockchain.
Additionally, Visa, ANZ, Fidelity, and ChinaAMC will examine settlement options for interbank transfers and cross-border payments via e-HKD and tokenized deposits, helping Australia-based corporate investors buy tokenized fund units from Hong Kong asset management firms.
Other participants in this initiative include major entities like Bank of China, HSBC, ICBC, Standard Chartered Bank, DBS, BlackRock, Mastercard, and China Mobile.
The HKMA expects to disclose key findings from the second phase by the end of 2025. Phase 1 of the e-HKD pilot focused on domestic retail use cases concerning programmable payments, settlement of tokenized assets, and offline payments.
Eddie Yue, chief executive of the HKMA, expressed in a statement, “The e-HKD Pilot Programme has provided a valuable opportunity for the HKMA to explore with the industry how new forms of digital money can add unique value to the general public. The HKMA will continue to adopt a use-case driven approach in its exploration of digital money.”
The HKMA began researching CBDCs in 2017 and intensified its focus on studying a potential e-HKD in 2021 at both wholesale and retail levels.
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