HKMA initiates first CBDC steps with whitepaper launch

The Hong Kong Monetary Authority (HKMA) has begun the first steps of exploring a central bank digital currency (CBDC) with the release of a technical whitepaper.

The whitepaper examines the possibility of a ‘e-HKD’ and studies the potential of issuing retail CBDC in Hong Kong and is focused on coming up with an initial viewpoint by the middle of 2022.

Exploring the potential technical design options for issuing and distributing retail CBDC’s the document will also include an arrangement that enables transaction traceability in a privacy-friendly manner.

The HKMA has noted that it intends to reach out to academics and the wider financial industry to identify and resolve seven key major policy areas that has arisen during the research. These include issues around privavy, performance and scalability, cybersecurity, compliance, resilience, interoperability and technological capabilities.

HKMA CEO Eddie Yue said, “The white paper 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.”

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