E-HKD’s Development in Hong Kong- The Future Way of Currency?
A study shows that 90% of surveyed central banks worldwide are exploring the future issuance of central bank digital currencies (CBDCs). Blockchain.News interviewed industry experts to find out the outlook of Hong Kong’s digital currency and its potential adoption.
The outlook of e-HKD
In a recent discussion paper publishedby The Hong Kong Monetary Authority (HKMA), the local regulator reached out to the public to consult on the development of retail central bank digital currency (rCBDC) or the digital Hong Kong Dollar (e-HKD). The discussion paper lists a wide range of issues with a dozen key questions covering a wide range of issues:
The role of e-HKD
The rCBDCs can be divided into two-tier distribution models: the wholesale interbank system and the retail user wallet system, according to the e-HKD technical whitepaper.
«The wholesale CDBC is used for transfers between the central bank and commercial banks or other institutions, while the retail CDBC is used for transfers between commercial banks and the general public for retail transactions,» Professor Chew Seen-Meng, Associate Professor of Practice in Finance and Associate Dean (External Engagement) of the Chinese University of Hong Kong (CUHK) explained.
Regarding retail CBDCs, a doubt that could arise among the public could be why the market still needs another digital payment tool among other diverse options in HK?
Chew, the former economist for the Singapore office of the International Monetary Fund (IMF) and Morgan Stanley, acknowledged that “it is true that there is no urgent need for a digital HKD.”
However, “having an e-HKD could make our lives even more convenient by eliminating the need to carry physical notes and coins around and enables virtually all
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