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Hong Kong To Issue World’s First Tokenized Green Bonds by Year’s End

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Quick Take

Hong Kong’s financial authorities announced that they would issue the world’s first tokenized government green bonds by the end of the year.
The collapse of FTX has spurred the efforts of Hong Kong authorities to regulate crypto.
Bloomberg also reports that Hong Kong plans to legalize retail crypto trading.

Hong Kong will issue what is the world’s first tokenized government green bonds by the end of the year. Reports also state that the region will legalize retail crypto trading.

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Hong Kong’s financial authorities are committing to better regulate the crypto market, issuing a policy statement on the matter. In the official notice, the financial secretary also revealed several pilot programs. The most notable of these was the issuance of a new batch of tokenized green bonds for institutional investors.

First Green Bonds

The notice stated that the government green bonds would launch by the end of the year. This would make it the first tokenized government green bond in the world. Financial authorities are also keen on tapping into decentralized technology, with financial Secretary Paul Chan Mo-Po saying,

“We need to take full advantage of the potential offered by innovative technologies, but we also need to be careful to guard against market volatility and potential risks they may cause, so as to prevent transmission of the risks and impacts to the real economy.”

The notice referred to a central bank digital currency (CBDC), noting that a digital Hong Kong dollar was under consideration. The study would focus on how it could serve as “the ‘backbone’ and pillar connecting legal tender and virtual assets.” The Hong Kong Monetary Authority also announced a follow-up to its previous consultation on stablecoin regulation.

FTX crash inspiring new regulatory resolve

The announcement of a new policy focus coincides with the spectacular collapse of FTX, which has roiled the markets. The development has only spurred regulators to further impose controls over the crypto market, and Hong Kong is no different.

Animoca Brands co-founder chairman Yat Siu revealed that he expects the crash of FTX to only bolster Hong Kong’s determination to create a regulatory framework. Siu believes that this revived regulatory interest will help “correct what has so far gone wrong in the market.”

Hong Kong reportedly looking to legalize retail crypto trading

Hong Kong’s desire to introduce better regulatory checks for the crypto market accompanies a plan to legalize crypto trading. Bloomberg reported the news, citing sources that revealed “a planned mandatory licensing program for crypto platforms” could arrive by March.

The sources also said that regulators will permit the list of bigger tokens but will not endorse specific cryptocurrencies. The whole effort is a bid to rekindle interest in Hong Kong as a financial hub. It appears that mandatory licensing will also be a key part of the policy.CRYPTOCASTER® - DECENTRALIZED FREEDOM!
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