Hong Kong is marketing multi-currency digital bonds for the third time, with an aim to become a global hub for digital assets.
Bloomberg reported Monday that the new set of “digitally native” bonds will be denominated in US dollars, Hong Kong dollars, euros and offshore yuan. Sources familiar with the move said that the deal could be priced as early as Monday.
A digital bond is a type of security issued and managed using blockchain technology. The blockchain allows the bond’s details and ownership to be recorded securely and transparently on a digital ledger.
The latest offering of digitally native bonds across multiple currencies can be issued on public blockchains like Ethereum or via DLT platforms offered by HSBC Holdings or Goldman Sachs.
Digital Bonds Gain Traction in Hong Kong
Hong Kong’s latest move builds on the city’s established tokenized bond frameworks announced in 2024. The HKMA introduced its second tokenized green bond in 2023, aiming to leverage blockchain for transparency in the redemption process.
Besides, Hong Kong has solidified its position as Asia’s leading international bond issuance hub. It accounts for nearly 30% of Asian international bond issuances, topping the regional league table for nine years.
The announcement to sell digital green bonds comes days after global asset manager Franklin Templeton launched Hong Kong’s first tokenized money-market fund. The fund uses blockchain to boost transparency and transaction efficiency and is initially open to institutional investors.
Further, Hong Kong-based corporates issue at least six digital notes, Bloomberg noted. These notes have raised a total of $1 billion with four launching this year.
Rain Yin, Director at S&P Global Ratings, said that the firm has given AA+ rating to the proposed digital notes. “Those are mitigated by a plan that requires, ultimately, shifting the notes to the traditional systems in case of disruption.”
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