HKMA To Ready HK For Its Own Digital Currency

The Monetary Authority (HKMA) announced on Tuesday that it will go ahead with preparations for the eventual issuance of Hong Kong's own digital currency, after looking into its prospects and garnering support in a market consultation.

The authority will start looking into developing a system for the e-HKD, its potential uses and the necessary legislative amendments in the upcoming quarter.

"The digital economy is growing and evolving so rapidly that a lot of people see the availability of a CBDC (central bank digital currency) including a retail level e-Hong Kong dollar should be conducive to further development of digital economy, so we agree with this vision," said Howard Lee, a deputy chief executive of the HKMA.

Lee acknowledged that the there has not been any imminent application need for digital currency here yet, but he pointed out that the authority wants to "future-proof" Hong Kong for when a "digital e-Hong Kong dollar era" arrives.

He said the authority will be working with banks, payment operators and tech firms to explore the potential usage of digital currency in the SAR.

"We want to provide some kind of system, some kind of environment for them to come up with creative, imaginative use cases," said Lee.

However, he said the preparation work is expected to take years and the eventual launch of e-HKD would depend on the global development of digital currencies.