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Hong Kong has launched the pilot for a digital version of its currency, e-HKD.
Announced yesterday by the Hong Kong Monetary Authority (HKMA), the e-HKD will be tested by 16 banks and payment companies including Alibaba Group’s Alipay Financial, Mastercard Asia, Ripple Labs, Visa and HSBC.
Use cases tested by the firms include full-fledged payments, programmable payments, offline payments, tokenised deposits, settlement of Web3 transactions and settlement of tokenised assets.
The programme is a key component of Rail 2 under the HKMA's three-rail approach towards the potential implementation of a retail CBDC (central bank digital currency).
However, the HKMA reiterated that it is "not yet at a point where a firm decision can be made to introduce e-HKD" but the outcomes of the pilot will aid its consideration.
Its learnings will be shared at Hong Kong FinTech Week 2023 (30 October - 5 November 2023).
Eddie Yue, HKMA chief executive, said that whilst "the HKMA has not yet made a decision on whether and when to introduce e-HKD," the institution believes the e-HKD pilot programme will serve as a "tremendous opportunity for the HKMA to collaborate with the industry in exploring innovative use cases."
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