- HKMA to support tokenized deposits and regular issuance of digital bonds.
- SFC drafting licensing framework for trading, custody, and stablecoin issuers.
- New rules will cover stablecoin issuers, digital asset trading, and custody services.
Hong Kong is stepping up its digital finance ambitions with a policy blueprint that places tokenization at the core of banking innovation.
In the 2025 Policy Address, Chief Executive John Lee outlined measures that will see the Hong Kong Monetary Authority (HKMA) encourage commercial banks to roll out tokenized deposits and expand the city’s live tokenized-asset transactions.
Hong Kong’s Project Ensemble to Drive Tokenized Deposits
Lee confirmed that the HKMA will “continue to take forward Project Ensemble, including encouraging commercial banks to introduce tokenised deposits, and promoting live transactions of tokenised assets, such as the settlement of tokenised money market funds with tokenised deposits.”
The initiative aims to embed tokenized deposits, bank liabilities represented as blockchain-based tokens, into mainstream financial operations. These deposits could facilitate the settlement of money-market funds and other financial instruments more quickly and efficiently.
To ensure a controlled rollout, the HKMA will utilize its regulatory sandbox to enable banks to test tokenized products while enhancing risk management.
Tokenized Bonds to Become a Regular Feature
Beyond deposits, the government intends to make tokenized bond issuance a permanent element of Hong Kong’s financial markets. After successful pilots, including green bonds, the HKMA will help regularize the issuance process to build deep and liquid markets for digital bonds accessible to both local and international investors.
Related: Beijing Blocks State-Owned Firms From Stablecoin Businesses in Hong Kong
Hong Kong’s Global Financial Role
The policy address also set out a comprehensive regulatory framework for digital assets. Hong Kong is implementing a regime for stablecoin issuers and drafting licensing rules for digital asset trading and custody services.
The Securities and Futures Commission (SFC) is exploring ways to widen the range of digital-asset products available to professional investors, while prioritizing investor protection. Automated reporting and data surveillance tools will be introduced to monitor risks such as cross-border tax evasion.
Officials positioned these tokenization initiatives as part of the plan to keep Hong Kong among the world’s leading financial hubs.
Alongside expanding the bond market and strengthening stock-market rules, the city aims to grow its role in cross-border digital trade and the international use of the Chinese yuan.
Related: Hong Kong Moves to Compete Globally by Softening Crypto Rules for Local Lenders
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