Policy Address

Establish a New Fintech Innovation Ecosystem

99. The Government will continue to promote the development of innovative financial services including Central Bank Digital Currencies (CBDCs), mobile payment, virtual banks, virtual insurance and virtual asset (VA) transactions. The FSTB will shortly issue a policy statement, setting out its policy stance regarding the application of AI in the financial market. Other measures include:

  1. promoting the use of CBDCs for cross-boundary payment – The HKMA is actively testing and exploring more add-on technology solutions and use cases related to cross-boundary trade settlement on the mBridge platform, and will further widen the participation of both the public and private sectors;

  2. enhancing the regulation of VA trading – The FSTB will complete the second round public consultation on the regulatory proposals for over-the-counter trading of VA and put forward a proposed licensing regime for VA custodian service providers;

  3. promoting real-world asset tokenisation and developing a digital money ecosystem – The HKMA is taking forward Project Ensemble, a financial market infrastructure project, to explore the application of real-world asset tokenisation and the use of digital money for interbank settlement, facilitating the development of the relevant asset trading. Separately, the HKMA also allows potential stablecoin issuers to test business plans and use-cases through the stablecoin issuer sandbox, and will work with the FSTB to introduce a bill on the regulation of fiat-referenced stablecoin issuers later this year; and

  4. promoting the development of the digital securities market – The HKMA will soon launch the Digital Bond Grant Scheme to encourage more financial institutions and issuers to adopt tokenisation technology in capital market transactions.