Hong Kong Central Bank Launches Wholesale CBDC Project to Foster Tokenization

Author

Ruholamin Haqshanas

Author

Ruholamin Haqshanas

About Author

Ruholamin Haqshanas is a contributing crypto writer for CryptoNews. He is a crypto and finance journalist with over four years of experience. Ruholamin has been featured in several high-profile crypto...

Author Profile

Share

Copied

Last updated:

March 7, 2024 08:20 EST

Why Trust Cryptonews

Cryptonews has covered the cryptocurrency industry topics since 2017, aiming to provide informative insights to our readers. Our journalists and analysts have extensive experience in market analysis and blockchain technologies. We strive to maintain high editorial standards, focusing on factual accuracy and balanced reporting across all areas - from cryptocurrencies and blockchain projects to industry events, products, and technological developments. Our ongoing presence in the industry reflects our commitment to delivering relevant information in the evolving world of digital assets. Read more about Cryptonews

Ad Disclosure

We believe in full transparency with our readers. Some of our content includes affiliate links, and we may earn a commission through these partnerships. Read more

Hong Kong’s central bank has announced the launch of a new project called “Project Ensemble,” aimed at supporting the development of the tokenization market in the city-state through a wholesale central bank digital currency (wCBDC). In a Thursday press release, the Hong Kong Monetary Authority (HKMA) said the project aims to explore financial market infrastructure that facilitates seamless interbank settlement of tokenized money using wCBDC.Initially, Project Ensemble will focus on tokenized deposits, which are digital representations of commercial bank deposits issued by commercial banks and available to the general public. By using wCBDC as the foundation, these tokenized deposits can be utilized for transactions involving tokenized assets, thereby unlocking new opportunities for optimization and innovation in the tokenization era, according to the HKMA.

Wholesale CBDC Project to Boost Hong Kong’s Financial Industry

Eddie Yue Wai-man, the Chief Executive of the HKMA, said the Wholesale CBDC project will provide a boost to Hong Kong’s vibrant financial industry and reinforce the city’s leading position in tokenized money and assets. Yue Wai-man emphasized Hong Kong’s commitment to innovation and international collaboration, inviting global talents and industry players to participate in this exciting tokenization journey.“Project Ensemble will provide fresh impetus to our vibrant financial industry and reinforce our forefront position in tokenized money and assets.”As part of the project, the HKMA plans to launch a wCBDC Sandbox later this year to facilitate research and testing of tokenization use cases. This includes exploring the settlement of tokenized real-world assets such as green bonds, carbon credits, aircraft, electric vehicle charging stations, electronic bills of lading, and treasury management. The goal is to bridge the gap between tokenized real-world assets and money in transactions, potentially forging a new financial market infrastructure.To ensure industry standards and a future-proof strategy, the HKMA will establish a wCBDC architecture community consisting of local and multinational banks, digital asset industry key players, technology companies, and the CBDC Expert Group. Additionally, the HKMA will continue its partnership with Cyberport and the Hong Kong Science and Technology Parks Corporation to support the development of asset tokenization and foster homegrown fintech innovation.

Hong Kong’s Crypto Licence Scheme Ends

The deadline for virtual asset trading platform (VATP) crypto license applications in Hong Kong has passed, with the number of applicants reaching 24.At least five cryptocurrency firms submitted their applications in the final days leading up to the February 29 deadline.Cryptocurrency exchanges that have not yet applied must exit the Hong Kong market by May 31.The Securities and Futures Commission (SFC) will announce approved and declined applications on a public register by June 1, 2024.After securing approval, virtual asset trading platforms can onboard new retail and institutional crypto investors and start marketing in Hong Kong.In comparison, when Singapore’s Monetary Authority gave crypto companies one month to notify their pre-existing status and intention to be licensed in 2021, it resulted in about 70 official license applications by the end of 2021, three times the number in Hong Kong.