Hong Kong links 24/7 token trading with bank settlement

The Securities and Futures Commission (SFC) and Hong Kong Monetary Authority (HKMA) said they jointly held a seminar on November 11, attended by approximately 200 financial industry professionals. Banks, asset managers and other businesses discussed potential uses in securities trading, corporate treasury management and payments, as well as liquidity and the role of licensed cryptocurrency platforms.

SFC Executive Director of Investment Products Elisa Ng said Hong Kong was moving “beyond experimentation towards commercialisation.” She said the next stage would connect tokenized investment products, digital currencies and financial infrastructure. HKMA Executive Director of Financial Infrastructure Nelson Chow said the authority would continue working with the SFC to support regulated services and cooperation among financial institutions.

The seminar followed the SFC’s October 26 approval of secondary trading in publicly offered tokenized money market funds on a licensed virtual asset trading platform. Two existing products were authorized for continuous trading, allowing eligible investors to buy and sell fund interests outside traditional market hours. The approval is limited to the funds covered by the framework, which includes requirements for pricing, liquidity, trading arrangements and investor disclosures. The SFC said it would monitor activity before considering other products.

The HKMA also upgraded its EnsembleTX infrastructure to enable participating institutions to settle qualifying tokenized deposit transactions around the clock using tokenized central bank money. Announced on November 2, the system is part of Project Ensemble, which aims to connect tokenized deposits with digital financial assets. The HKMA said 12 banks and 20 industry pioneers, including financial institutions and asset managers, were participating.

Standard Chartered launched tokenized deposit services for corporate customers in Hong Kong on November 2, using EnsembleTX to support transfers between participating institutions outside standard operating hours. China Asset Management, Finloop and PantherTrade have also taken part in transactions involving tokenized deposits and money market funds. The HKMA said future Project Ensemble work would focus on expanding transaction activity and supporting more types of tokenized investment products.