Banque de France and the Hong Kong Monetary Authority (HKMA) have joined hands to advance their efforts in Central Bank Digital Currency (CBDC) and asset tokenization through a newly signed Memorandum of Understanding (MoU).
The HKMA aims to explore interoperability between their CBDC infrastructures, enhancing cross-border transaction efficiency, as outlined in an official statement. Meanwhile, Banque de France has laid the groundwork with their DL3S infrastructure, crucial for CBDC implementation.
In parallel, HKMA’s Project Ensemble, initiated in March, focuses on asset tokenization and CBDC development. This initiative involves key stakeholders such as Hong Kong’s Architecture Community regulators, the Bank for International Settlements (BIS), major local banks, HashKey crypto exchange, Ant Digital Technologies, and Microsoft Hong Kong. The project will commence research and testing in the upcoming months.
Denis Beau, First Deputy Governor of Banque de France, expressed enthusiasm for the collaboration, highlighting the alignment with HKMA’s recent Project Ensemble announcement. He also noted Banque de France’s commitment to further testing their DL3S platform within this cooperative framework.
Additionally, HKMA and Banque de France collaborate in other ventures. HKMA participates in the European Central Bank’s distributed ledger technology testing, focusing on blockchain interoperability for tokenized government bonds. Banque de France, as an observer in Project mBridge, engages in the largest CBDC-related project to date, where HKMA is an original participant.
HKMA’s e-HKD CBDC, in development since 2021 and currently in its second pilot phase, explores various CBDC applications, including retail e-HKD testing with the BIS in Project Aurum. HKMA also collaborates with BIS and the United Nations on tokenized “green” bonds and partners with Ripple and Visa to explore real estate tokenization.
Tokenized financial assets are forecasted to reach approximately $2 trillion by 2030, with a bullish scenario suggesting a potential doubling to $4 trillion. McKinsey & Company analysts highlight tokenized treasuries’ substantial growth, reporting an 80% increase to $1.29 billion in tokenized U.S. treasuries and bonds locked on platforms like RWA.xyz since early 2024, amidst high yields in a period of elevated inflation and interest rates in the United States.
For more updates, follow us on Google News.