The Hong Kong Monetary Authority (HKMA) will set out to lay the groundwork for the implementation of a retail CBDC (Central Bank Digital Currency). This was revealed in a report released by the agency on June 10.
The HKMA has been considering the development of a “digital Hong Kong dollar” called “e-HKD” since at least 2017, but recent research and market input have led to the “possibility of future implementation of a retail CBDC. At least we need to start working on it,” he said.
“The HKMA will therefore begin laying the groundwork, in-depth research and piloting for (retail CBDC) implementation and utilization,” (report).
Central banks around the world are considering the possibility of a CBDC, and the Bank for International Settlements (BIS) has indicated the importance of studying the digitalization of the financial system and maintaining its stability.
The HKMA report states, “While e-HKD’s role in today’s retail payments market does not yet seem imminent, the rapid evolution or revolution in the digital economy will quickly bring e-HKD to the fore as a promising use case. I think it can emerge,” he wrote.
CoinDesk reported in April that the HKMA may be leaning towards developing e-HKD on a permissioned blockchain and leaving the implementation to private banks.
The HKMA said in its report that it will consider “various factors”, from policy objectives to methods adopted by other countries, and “further pursue technically feasible solutions on the subject”.
｜Translation: coindesk JAPAN
｜Editing: Takayuki Masuda
｜Image: Hong Kong skyscrapers (Unsplash)
｜Original: Hong Kong Monetary Authority to Prepare for Retail CBDC