Following a collaboration with the BIS Innovation Hub, the Hong Kong Monetary Authority (HKMA) released a technical Whitepaper on retail CBDC, called “e-HKD: A technical perspective.” The financial institution expects to come up with an initial view of the project by the middle of 2022.
One Step Closer to a CBDC
The HKMA doubled down on its efforts of launching a digital Hong Kong dollar (e-HKD). After exploring the project’s potential benefits with peer central banks, the monetary organization brought to light its official whitepaper on its future retail CBDC.
The HKMA’s partner in investigating the move was the Hong Kong Centre of the BIS Innovation Hub. Together, their mission was to analyze the details for issuing and distributing retail central bank digital currencies.
The Whitepaper is different than other similar papers as it reveals the technical architecture of the financial solution. Per the announcement, locals can expect the initial view of e-HKD by the summer of 2022.
It is worth noting that the HKMA introduced the “Fintech 2025” strategy earlier this year, and one of its key focuses was strengthened research work on CBDCs.
Mr. Eddie Yue – Chief Executive of the HKMA – noted that the move represents a significant step towards launching a future digital e-HKD:
“The Whitepaper marks the first step of our technical exploration for the e-HKD. The knowledge gained from this research, together with the experience we acquired from other CBDC projects, would help inform further consideration and deliberation on the technical design of the e-HKD. We also look forward to receiving feedback and suggestions from the academia and industry to enrich our perspectives.”
Hong Kong And Thailand with a Joint CBDC Project
Last year the central banks of the two nations revealed their intention to create a joint CBDC, dubbed Project Inthanon-LionRock, to facilitate efficient payments between each other.
Back then, the HKMA informed that the current payment system in Hong Kong was highly efficient. As such, it didn’t need to adopt a CBDC for settlements within the country. However, the authority believed cross-border payments need improvement, and digital currency could help solve the problem.
The central banks did not give a timeframe for launching their upcoming CBDC for real transactions. However, they vowed to continue working on the joint project and even add more countries to the Project Inthanon-LionRock.