The Hong Kong Financial Authority (HKMA) is gearing up for the second part of the e-HKD (e-Hong Kong greenback) pilot program because it introduced the profitable completion of the Section 1 trial of its in-house central financial institution digital foreign money (CBDC).
The HKMA launched the e-HKD pilot program in November 2022 to guage the business viability of an in-house CBDC as a part of its “Fintech 2025” technique. Section 1 was devoted to learning e-HKD in six areas, which embody full-fledged funds, programmable funds, offline funds, tokenized deposits, settlement of Web3 transactions and settlement of tokenized property.
Detailing the findings of the e-HKD part 1 trial, the HKMA report highlighted programmability, tokenization and atomic settlement as three key areas the place Hong Kong’s CBDC may gain advantage customers and companies.
The report learn:
“The subsequent part of the e-HKD pilot program will construct on the success of Section 1 and take into account exploring new use instances for an e-HKD.”
HKMA plans to “delve deeper” into some use instances that confirmed promising CBDC functions within the part 1 trial. Technical issues present an inclination towards utilizing distributed ledger expertise (DLT)-based design contemplating its interoperability and scalability capabilities.
As proven above, Hong Kong’s CBDC program consists of a three-rail strategy — basis layer improvement, business pilots and iterative enhancements and full launch. Presently, at its second rail, the e-HKD program trial is supported by private and non-private organizations to make sure business viability for each events.
HKMA stated it can additionally proceed to work on rail 1 initiatives resembling laying the authorized and technical foundations for e-HKD.
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Alongside localized efforts for CBDCs, quite a few central and business banks joined arms underneath Venture mBrigde to discover options for sooner, cheaper, extra clear cross-border funds.
On Sept. 25, HKMA CEO Eddie Yue revealed that mBridge will increase and be commercialized because it welcomed new banking members from China, Hong Kong, Thailand and the UAE.
“We expect to welcome extra fellow central banks to hitch this open platform. And really quickly, we are going to launch what we name a minimal viable product, with the intention of paving the best way for the gradual commercialization of mBridge,” Yue added.
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