Zodia Custody’s Post

The Hong Kong Monetary Authority (HKMA) is taking a big step forward in the world of digital finance by establishing a community to explore asset tokenization. This initiative has the potential to revolutionize the way we invest and manage traditional assets. The HKMA's community will bring together a diverse group of stakeholders, including regulators and private sector firms. This collaborative approach will be crucial for developing a robust framework for asset tokenization. This initiative by the HKMA is a promising sign for the future of global tokenization. By bringing together regulators and industry leaders, they're laying the groundwork for standardized practices and fostering a safe space for innovation. This collaborative approach could significantly accelerate the global adoption of tokenization and unlock its potential to revolutionize the financial landscape. Read more about the topic, here: https://lnkd.in/ePb9ix-U

Last week, the Hong Kong Monetary Authority (HKMA) launched Project Ensemble, a new wholesale #CBDC to support the Hong Kong #tokenization market 🚀🚀🚀 📌 Why this is very cool 📌 1️⃣ I've written about the need for #DigitalCash as a key pillar for #DigitalAssets ad nauseum (since 2021 / 2022 👴) 2️⃣ In my opinion, most of the potential benefits of tokenizing real world assets (#RWAs) remain untapped if reliant on legacy payment and settlement #infrastructures... 3️⃣ ...think wet ink signatures, PDFs, emails, batch settlements, no exception cases, zero programmability, etc. 4️⃣ An ideal digital cash solution should have i) in-market regulator backing, ii) brand cachet and recognition by the ecosystem, and iii) structurally de-risk early adopters 5️⃣ Project Ensemble ticks all three of those boxes by providing a ringfenced wCBDC sandbox for digital asset <> digital cash experimentation, prima facie 🫣 6️⃣ Looking forward to seeing use cases around i) US / EU / Asia market settlement windows, ii) lifecycle management / corporate action automation, and iii) achieving "true" atomic settlement 7️⃣ Also hoping to see meaningful progress on the (digital) securities law in #HongKong, and expect it to trigger a broader legal / regulatory shift in Asia-Pacific 8️⃣ In closing, Project Ensemble's success will depend on strong execution (i.e., architecture, systems design, features, time to market, etc.)... 9️⃣ ...and hopefully involve and engage regional / global financial market participants beyond Hong Kong 🤝 🔟 PS: One step closer to being able to buy $5 of S&P500 using your Octopus / EZ-Link Pte Ltd card (See below: My post on the Finternet) Bank for International Settlements – BIS Cyberport Hong Kong

📣 𝐁𝐫𝐞𝐚𝐤𝐢𝐧𝐠 𝐍𝐞𝐰𝐬: HKMA Initiates e-HKD Pilot Programme Phase 2! Hong Kong Monetary Authority (HKMA) is advancing digital finance by launching Phase 2 of its e-HKD Pilot Programme. The program aims to transform Hong Kong's financial landscape through innovative digital currency applications. 1. 𝐀𝐝𝐯𝐚𝐧𝐜𝐢𝐧𝐠 𝐟𝐫𝐨𝐦 𝐏𝐡𝐚𝐬𝐞 1: After exploring programmable payments, tokenized assets, and offline transactions, Phase 2 deepens these areas and introduces novel applications. 2. 𝐈𝐧𝐧𝐨𝐯𝐚𝐭𝐢𝐨𝐧 𝐚𝐭 𝐭𝐡𝐞 𝐅𝐨𝐫𝐞𝐟𝐫𝐨𝐧𝐭: The focus is on enhancing e-HKD's programmability, tokenization, and atomic settlement, exploring new possibilities in digital currency. 3. 𝐑𝐨𝐛𝐮𝐬𝐭 𝐒𝐮𝐩𝐩𝐨𝐫𝐭 𝐒𝐲𝐬𝐭𝐞𝐦: An enhanced e-HKD sandbox will accelerate the development and testing of new use cases, promoting swift transitions from ideas to implementation. 4. 𝐑𝐞𝐬𝐞𝐚𝐫𝐜𝐡-𝐃𝐫𝐢𝐯𝐞𝐧 𝐀𝐩𝐩𝐫𝐨𝐚𝐜𝐡: Ongoing HKMA research in CBDCs delves into key areas like privacy and interoperability, guiding the future of digital currencies. 5. 𝐂𝐨𝐦𝐦𝐮𝐧𝐢𝐭𝐲 𝐄𝐧𝐠𝐚𝐠𝐞𝐦𝐞𝐧𝐭: HKMA invites organizations to contribute to this groundbreaking project. Applications are open until 17 May 2024. The e-HKD Pilot Programme's Phase 2 is a pivotal step for Hong Kong's digital finance, highlighting the vast potential of digital currencies to create an inclusive, efficient, and innovative financial ecosystem.

Does Hong Kong have issues with USDT and USDC? — Exec weighs in As Hong Kong looks into creating Hong Kong dollar and US dollar stablecoins, a local industry executive addresses possible implications for UDST and USDC. As Hong Kong regulators launch a collaborative effort with the private sector focused on stablecoins, a local industry executive has discussed the potential implications for stablecoins such as Tether’s USDT and Circle’s USD Coin. On July 18, the Hong Kong Monetary Authority (HKMA) announced the first five participants in the country’s stablecoin issuer sandbox, including firms like Standard Chartered Bank, Animoca Brands, Hong Kong Telecommunications, Jingdong Coinlink Technology and RD InnoTech. As part of the sandbox — which launched in March 2024 — the participants are expected to test their proposed stablecoin business models and engage with HKMA on future compliance with the proposed regulatory regime. One of the sandbox participants, Jingdong Coinlink Technology, subsequently announced plans to issue a stablecoin pegged to the Hong Kong dollar on a 1:1 ratio. As Hong Kong has been actively moving to regulate the stablecoin industry and possibly create its own stablecoins, the local stablecoin ecosystem will likely transform significantly in the coming years, according to Davin Wu, chief financial officer of digital assets exchange OSL. Link + https://lnkd.in/dc5gS7Hg

𝗨𝗻𝗿𝗮𝘃𝗲𝗹𝗶𝗻𝗴 𝘁𝗵𝗲 𝗙𝘂𝘁𝘂𝗿𝗲: 𝗛𝗞𝗠𝗔'𝘀 𝗧𝗼𝗸𝗲𝗻𝗶𝘇𝗮𝘁𝗶𝗼𝗻 𝗩𝗲𝗻𝘁𝘂𝗿𝗲 𝘖𝘯𝘤𝘦 𝘢𝘨𝘢𝘪𝘯, 𝘵𝘩𝘪𝘴 𝘪𝘴 𝘢𝘣𝘰𝘶𝘵 𝘵𝘩𝘦 𝘛𝘰𝘬𝘦𝘯𝘪𝘻𝘦𝘥 𝘈𝘴𝘴𝘦𝘵 𝘗𝘳𝘰𝘫𝘦𝘤𝘵 𝘪𝘯 𝘵𝘩𝘦 𝘸𝘰𝘳𝘭𝘥 𝘰𝘧 𝘋𝘪𝘨𝘪𝘵𝘢𝘭 𝘍𝘪𝘯𝘢𝘯𝘤𝘦 In the bustling financial hub of Hong Kong, the Monetary Authority (HKMA) unveils its latest endeavor—a groundbreaking initiative to reshape the landscape of cross-border payments and tokenization. Enter the Project Ensemble Architecture Community. This community is poised to revolutionize the way assets are tokenized in Hong Kong. By fostering collaboration between industry stakeholders, it aims to establish standards and provide guidance to propel the development of Hong Kong's tokenization market. At its core, the community seeks to develop industry standards to ensure interoperability between wholesale Central Bank Digital Currencies (wCBDCs), tokenized money, and tokenized assets. Its recommendations will initially focus on establishing mechanisms to facilitate seamless token deposit settlements across banks via wCBDCs for tokenized asset transactions. But what sets this initiative apart is its diverse composition. With representatives spanning regulators, international organizations, academia, local and multinational banks, key players in the digital asset industry, and technology firms, the community boasts a wealth of expertise and experience. And the timing couldn't be more opportune. As the world grapples with the complexities of cross-border payments, HKMA's initiative offers a glimmer of hope. By streamlining tokenization processes and fostering collaboration, it holds the promise of addressing longstanding challenges in cross-border payments in Asia. This venture is not just about reshaping the financial landscape—it's about unlocking new possibilities and driving innovation. It's about paving the way for a future where cross-border payments are seamless, efficient, and inclusive. As HKMA embarks on this journey, one thing is clear: the future of cross-border payments is here, and it's tokenized. This is very interesting, thank you for sharing, Theodora Lau 😍🌷🙏 #FinancialRevolution #BankingInnovation #GlobalFinance #InvestmentBanking #Swift #CrossBorderPayment #RadithyaCoPartner #MataramPostmo #SolarNet #MPPlusStrategy #Blockchain #DeFi #Fintech #WealthAssetManagement #AssetManagement #CBDC #StableCoin #Crypto #DecentralizedEcosystem #FinancialTechnology #KHMA

【HKMA Establishes Ensemble Project Architecture Working Group to Support Development of Hong Kong’s Tokenization Market】 According to official news, the Hong Kong Monetary Authority announced today the establishment of the #Ensemble Project Architecture Working Group to work with the industry to establish standards and make recommendations to support the development of Hong Kong's #tokenization market. 　　 The working group will promote the formulation of industry standards to support the interoperability between wholesale central bank digital currencies (#wCBDC), tokenized currencies and tokenized assets. The working group will make recommendations on specific issues, and will initially focus on establishing mechanisms for tokenized asset transactions to smoothly conduct interbank settlement of tokenized deposits through wCBDC. The working group will also assist in the design and construction of the Ensemble project sandbox, which is scheduled to be launched in the middle of this year, to further study and test tokenization use cases. 　　 The working group is composed of cross-disciplinary industry representatives, covering regulators, international organizations, academia, local and multinational banks, major players in the digital asset industry, and technology companies. The initial members include the HKMA, the Securities and Futures Commission, the Hong Kong Centre of the Bank for International Settlements Innovation Hub, the CBDC Expert Group (Note 2) and seven private institutions, namely Bank of China (Hong Kong), Hang Seng Bank, HSBC, Standard Chartered Hong Kong, HashKey Group, Ant Digital Technology and Microsoft Hong Kong.

Reimagining a Future Empowered by e-HKD, Tokenised Deposits, and Stablecoins An analysis of the transformative potentials of digital financial instruments. With pivotal insights from the Hong Kong Monetary Authority (HKMA) and leading financial innovators, the document explores the catalytic role of these emerging technologies in redefining Hong Kong’s financial landscape. Adopting electronic Hong Kong Dollars (e-HKD), alongside integrating tokenized deposits and stablecoins, represents a significant shift toward more efficient, secure, and inclusive financial systems. These instruments are poised to enhance transactional throughput and reliability across domestic and international markets. ➡ Quantitative Forecasts and Economic Impacts The proactive engagement of both public and private sectors is forecasted to unlock substantial economic benefits. By deploying these digital instruments, Hong Kong could bolster its GDP by an additional 0.5% annually over the next decade. This projection equates to an added HK$160 billion in economic output by 2032, driven by: 1. Increased liquidity through asset tokenization. 2. More accessible and flexible financial products. 3. Integration into the burgeoning Web3 and virtual assets economy. 4. Strengthened international financial connections. ➡ Strategic Recommendations - Development of robust legal frameworks to support the viability and security of digital financial instruments. - Establishment of industry-wide standards to ensure compatibility and interoperability between different technologies and platforms. - Engagement in continuous public-private partnerships to drive innovation and adoption. Read the detailed analysis here: https://lnkd.in/g7hJbsXJ. #EVIDENT #tokenization #ehkd #tokenizeddeposit #web3

Hong Kong’s financial regulators and industry participants are working on the future: 1️⃣ Cross border multi-CBDC platforms 2️⃣ eRMB use cases expanding 3️⃣ progress on the eHKD 4️⃣ Stablecoin issuance regulations in the pipeline 5️⃣ Digital assets regulations The HK of the present and future won’t be the Hong Kong of the past.

Future of Cross-Border Tokenization: Partnership Between the Central Bank of Brazil and the Hong Kong Monetary Authority! The Central Bank of Brazil (Banco Central do Brasil) and the Hong Kong Monetary Authority (#HKMA) have taken a decisive step in advancing tokenization on a global scale by connecting their experimental platforms – #Drex in Brazil and #Ensemble in Hong Kong. This collaboration represents not only a connection between two distinct jurisdictions but also a shared vision on the role of tokenization technologies and central bank digital currencies (CBDCs) in the future of the international financial market. 🌍Why is this partnership essential? For the #BCB, Drex is a cornerstone in developing a tokenized financial market in Brazil, aiming to integrate the country into a rapidly transforming global economy. Asset tokenization opens new horizons in areas such as international trade and carbon credits, promoting a safer, more transparent, and efficient financial environment. Roberto Campos Neto, BCB’s president, emphasized the importance of “connecting two jurisdictions on opposite sides of the globe” and highlighted that such collaborations are essential to creating a more integrated global financial market. For the HKMA, Project Ensemble provides an experimental space where financial innovation can thrive. With a focus on green finance, sustainability, and liquidity management, Hong Kong aims to establish itself as a sustainable financial hub. Eddie Yue, CEO of the HKMA, described the collaboration with the BCB as “a seed that has now blossomed.” This reflects HKMA’s commitment to working with global partners to responsibly and innovatively shape the future of finance. 🌍What does this partnership mean for the future? This collaboration exemplifies the power of joint innovation. The BCB and HKMA are actively testing the potential of payment versus payment (#PvP) and delivery versus payment (#DvP) settlement mechanisms, enabling transactions across multiple currencies and asset classes. By exploring these use cases, both central banks reinforce tokenization’s role in enhancing financial efficiency, inclusion, and sustainability. As a professional engaged in blockchain and #CBDC initiatives, I see this partnership as a milestone that solidifies the role of CBDCs and tokenization as essential pillars of the global financial future. Collaborations across jurisdictions like this one serve as a model for what we can achieve when we join forces for the greater good – a more connected, inclusive, and sustainable financial system. Tokenization and CBDCs are the future – and the future is now!

As digital finance continues to evolve, regulatory frameworks struggle to keep pace with the rapid advancements and inherent risks. In response to the emerging risks in the fast-evolving virtual asset sector, authorities have proposed a framework for stablecoin regulation in Hong Kong, targeting issuers within this dynamic market. Check out this article and learn more about Hong Kong’s latest initiative led by the Financial Services and the Treasury Bureau (FSTB) and the Hong Kong Monetary Authority (HKMA). https://lnkd.in/g3Y52Xr9