The Hong Kong Monetary Authority (HKMA) reportedly issued an official white paper, detailing the plan for studying the potential of a retail-centric CBDC – the digital Hong Kong dollar (e-HKD).

Specifically outlined in the paper, the HKMA is reportedly going to explore the “potential architectures and design options”, employing a technical and regulatory policy approach. 

The HKMA reportedly has a target of building a dual-tier network – the first dedicated to a “central bank to issue and redeem CBDC”, and the second will focus on the retail sector, catering to “commercial banks to distribute and circulate either rCBDC or CBDC-backed e-money.”

Hong Kong initially kickstarted its deep-dive into CBDCs four years ago (2017) via Project LionRock, and last year, it spent resources on a joint project with the Bank of Thailand – which lasted for 7 months – to understand the “potential of wholesale CBDC for cross-border payments.”

The scale of the project was quickly widened, growing into a Multiple CBDC Bridge in February this year, after the Central Bank of the United Arab Emirates and the Digital Currency Institute of the People’s Bank of China were rolled out. 

The so-called “m-CDBC” was reportedly designed with the purpose of utilizing distributed ledger tech to provide a proof-of-concept model for a unified payments network.

In June 2021, the HKMA reportedly disclosed details regarding “Fintech 2025” – a financial technology project, primarily revolving around five aspects of innovation, including providing assistance for central banks in the adoption of a CBDC, building a skilled workforce, together with the project released on October 4th. 

“The Whitepaper marks the first step of our technical exploration for thee-HKD. The knowledge gained from this research, together with the experience we acquired from other CBDC projects, would help inform further consideration and deliberation on the technical design of the e-HKD.” HKMA chief executive Eddie Yue additionally remarked.