Hong Kong Monetary Authority promotes the development of tokenized markets, establishes a dedicated task force

The Hong Kong Monetary Authority (HKMA) announced today on May 7th the establishment of the "Ensemble Project Architecture Working Group" with the aim of collaborating with the industry to jointly develop standards and recommendations to support the development of Hong Kong's tokenized market. [Link to Announcement].

Establishing Cross-Domain Working Group to Drive Interoperability Standards

The newly established working group by the Hong Kong Monetary Authority is dedicated to promoting the development of industry standards, particularly focusing on the interoperability among wholesale Central Bank Digital Currency (wCBDC), tokenized currencies, and tokenized assets. The initial emphasis of this strategy will be on establishing mechanisms for trading tokenized assets and facilitating tokenized deposit swaps among banks through wCBDC.

Initial Focus on Building Settlement Mechanisms

The initial tasks of the working group include establishing effective mechanisms for trading tokenized assets and exploring interbank settlements through wCBDC. Additionally, the group will assist in designing and constructing the "Ensemble Project Sandbox" expected to be launched in the middle of this year to further research and test tokenized application scenarios.

Member Composition and Professional Background

The working group brings together industry representatives from regulatory bodies, international organizations, academia, local and multinational banks, digital asset industry, and technology companies. Initial members include the Hong Kong Monetary Authority, the Securities and Futures Commission, the Hong Kong Centre under the Innovation Hub of the Bank for International Settlements, the CBDC Expert Group, and seven private institutions such as Bank of China Hong Kong, Hang Seng Bank, HSBC, Standard Chartered Hong Kong, HashKey Group, Ant Group, and Microsoft Hong Kong.

The Hong Kong Monetary Authority stated that careful consideration will be given to the professional knowledge, experience, and innovative capabilities of the working group members to ensure the advancement of the tokenization market in Hong Kong. The HKMA will also continue to closely collaborate with the industry, periodically review and adjust the size and composition of the working group to meet the needs of market development.