Hong Kong’s Monetary Authority and the Financial Services and the Treasury Bureau said they have completed a first-phase review on promoting broader use of distributed ledger technology (DLT) in Hong Kong’s fixed-income market.
According to Odaily, the review found that Hong Kong’s current legal and regulatory framework is sufficiently flexible to support the issuance of tokenized bonds.
The authorities cited three batches of tokenized bonds issued by the Hong Kong government, along with a growing number of corporate issuances, including offerings from issuers in Asia and the Middle East.
They said the next phase will involve a legislative review aimed at enabling wider application of DLT across the fixed-income market and the digital asset sector. Planned areas of work include allowing tokenized bond issuance documents to be executed electronically and exploring concepts related to the “custody” and “transfer” of tokenized fixed-income products.