Hong Kong Launches Central Bank Digital Currency Initiative for Tokenisation in Finance

Hong Kong is advancing the integration of tokenisation into traditional finance with the introduction of a new initiative for the Ensemble project - the Central Bank Wholesale Digital Currency (CBDC).

On Wednesday, the Hong Kong Monetary Authority (HKMA) unveiled the project, designed to evaluate the use of tokenisation across different financial sectors.

Unlike retail CBDCs designed for public transactions, wholesale CBDCs are designed for use by financial institutions.

These digital currencies are critical for interbank payments and high-value transactions, playing a key role in the infrastructure of the financial system.

Initially, the HKMA’s initiative will target four main areas: fixed income and investment funds, liquidity management, green and sustainable finance, and trade supply chain finance.

Major financial institutions participating in the initiative include Bank of China, HSBC, Hang Seng Bank and Standard Chartered Bank. Technology companies such as Ant Digital and Microsoft, as well as asset managers such as BlackRock, CSOP Asset Management, Franklin

Templeton and China Asset Management will also participate in the project.
As part of this initiative, Ant Digital Technologies, the blockchain arm of Ant Group, aims to increase the efficiency of funding.