HKMA introduces new project to accelerate tokenisation adoption
28 August 2024 Hong Kong
Image: Cozyta/stock.adobe.com
The Hong Kong Monetary Authority (HKMA) has launched Project Ensemble Sandbox to facilitate interbank settlement.
Using experimental tokenised money and focusing on transactions involving tokenised assets, the Sandbox will enable experiments for both payment-versus-payment and delivery-versus-payment use cases.
The HKMA assembled a diverse group of industry participants from the financial and technology sectors to participate in the initiative.
Participating banks from the Project Ensemble Architecture Community (the Community) have connected their tokenised deposit platforms to the Sandbox to enable the experiments.
The initial round of experimentation will cover the tokenisation of both traditional financial assets and real-world assets.
It will focus on four main themes: fixed income and investment funds, liquidity management, green and sustainable finance, and trade and supply chain finance.
The SFC, a member of the Community, is responsible for helping to develop a regulatory framework that will support the sustainable growth of the tokenised asset market in Hong Kong.
In addition, the SFC will be co-leading with HKMA on tokenisation initiatives for the asset management industry to promote wider adoption and enhance Hong Kong鈥檚 position as an asset and wealth management centre.
Eddie Yue, chief executive of the HKMA, says: 鈥淭he introduction of the Project Ensemble Sandbox to test tokenisation use cases marks a significant step forward for the HKMA and the industry to explore the application of tokenisation in real-life business scenarios.
鈥淪ince the launch of Project Ensemble in March, we have been encouraged by the strong interest from the industry in pioneering innovative solutions to redefine the digital finance landscape.鈥�
He also outlines a collaborative vision for the future, emphasising partnerships with the 麻豆传媒 and Futures Commission (SFC), other central banking institutions, academia, and industry stakeholders to drive progress in the Hong Kong tokenisation market.
In order to strengthen Hong Kong鈥檚 position as an international financial centre, the HKMA will continue to engage with the industry to gauge interest in tokenisation, develop new themes, and identify further use cases for tokenisation.
The HKMA will also explore collaborating with the BIS Innovation Hub Hong Kong Centre and engage the CBDC Expert Group to leverage their subject matter expertise to further advance the Sandbox.
Julia Leung, CEO of the SFC, comments: 鈥淭he Sandbox launch is a clear example of how innovation and regulation can go hand in hand to blaze a new path for our financial markets.
鈥淎s two major architects of Hong Kong鈥檚 financial markets, the SFC and the HKMA share the same vision and dedication to future-proofing the city鈥檚 financial system through innovative market infrastructure.鈥�
Using experimental tokenised money and focusing on transactions involving tokenised assets, the Sandbox will enable experiments for both payment-versus-payment and delivery-versus-payment use cases.
The HKMA assembled a diverse group of industry participants from the financial and technology sectors to participate in the initiative.
Participating banks from the Project Ensemble Architecture Community (the Community) have connected their tokenised deposit platforms to the Sandbox to enable the experiments.
The initial round of experimentation will cover the tokenisation of both traditional financial assets and real-world assets.
It will focus on four main themes: fixed income and investment funds, liquidity management, green and sustainable finance, and trade and supply chain finance.
The SFC, a member of the Community, is responsible for helping to develop a regulatory framework that will support the sustainable growth of the tokenised asset market in Hong Kong.
In addition, the SFC will be co-leading with HKMA on tokenisation initiatives for the asset management industry to promote wider adoption and enhance Hong Kong鈥檚 position as an asset and wealth management centre.
Eddie Yue, chief executive of the HKMA, says: 鈥淭he introduction of the Project Ensemble Sandbox to test tokenisation use cases marks a significant step forward for the HKMA and the industry to explore the application of tokenisation in real-life business scenarios.
鈥淪ince the launch of Project Ensemble in March, we have been encouraged by the strong interest from the industry in pioneering innovative solutions to redefine the digital finance landscape.鈥�
He also outlines a collaborative vision for the future, emphasising partnerships with the 麻豆传媒 and Futures Commission (SFC), other central banking institutions, academia, and industry stakeholders to drive progress in the Hong Kong tokenisation market.
In order to strengthen Hong Kong鈥檚 position as an international financial centre, the HKMA will continue to engage with the industry to gauge interest in tokenisation, develop new themes, and identify further use cases for tokenisation.
The HKMA will also explore collaborating with the BIS Innovation Hub Hong Kong Centre and engage the CBDC Expert Group to leverage their subject matter expertise to further advance the Sandbox.
Julia Leung, CEO of the SFC, comments: 鈥淭he Sandbox launch is a clear example of how innovation and regulation can go hand in hand to blaze a new path for our financial markets.
鈥淎s two major architects of Hong Kong鈥檚 financial markets, the SFC and the HKMA share the same vision and dedication to future-proofing the city鈥檚 financial system through innovative market infrastructure.鈥�
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