Hong Kong CBDC Pilot Advances to Phase 2 with New Firms Exploring e-HKD Use Cases

The Hong Kong Monetary Authority (HKMA) has launched Phase 2 of the e-HKD pilot program, focusing on tokenized deposits, asset settlement, and offline payments with the participation of 11 firms. The initiative aims to establish practical use cases for digital money, with findings expected by 2025.

The Hong Kong Monetary Authority (HKMA) has entered Phase 2 of its e-HKD pilot program, expanding its exploration of digital money and tokenized deposits under the newly renamed Project e-HKD+. This initiative marks a significant step forward in Hong Kong’s journey toward integrating central bank digital currencies (CBDCs) into its financial ecosystem.

Launched on Monday, the second phase of the program features 11 groups of firms selected from various sectors to assess practical applications of e-HKD and tokenized deposits. The pilot focuses on three main themes: settlement of tokenized assets, programmability, and offline payments. These innovative areas will explore how digital currencies can improve transaction efficiency and broaden financial inclusion.

Firms Participating in Phase 2

Prominent firms such as Hang Seng Bank, HSBC, Standard Chartered, Visa, Mastercard, Blackrock, and Boston Consulting Group (BCG) are among the participants. The inclusion of global leaders in finance, technology, and consulting signals strong industry support for Hong Kong’s digital currency development. The selected firms are tasked with evaluating the commercial viability of e-HKD and tokenized deposits across various financial services.

Expanded Focus Under e-HKD+

With the new name, Project e-HKD+, the HKMA emphasizes its broader focus on the wider digital money ecosystem beyond just CBDCs. This reflects its ambition to integrate both public and private currencies under a unified digital framework. The HKMA has also announced the creation of the e-HKD Industry Forum to foster collaboration and address potential industry challenges.

Eddie Yue, Chief Executive of the HKMA, commented on the collaborative effort:
“We look forward to working closely with industry participants in Phase 2 to push the boundaries of digital currency innovation.”

Goals for Phase 2

As part of the program, an e-HKD sandbox will allow firms to prototype and test different use cases in a controlled environment. The goal is to resolve potential technical and regulatory challenges while refining the infrastructure for a broader digital currency rollout. Findings from these sandbox trials are expected to be shared by late 2025.

Looking Ahead

Hong Kong’s e-HKD Pilot, launched in 2023, continues to push the boundaries of digital currency development. With the transition into Phase 2, the HKMA is positioning itself as a leader in CBDC innovation, exploring how tokenized assets and programmable money can reshape financial systems. The results of this pilot will not only impact Hong Kong’s monetary framework but could also influence global discussions on the future of digital money.

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