How Hong Kong’s CBDC roadmap is similar to Reserve Bank of India’s (RBI) eRupee approach

As the CBDC plan enters the second phase, the Hong Kong Monetary Authority (HKMA) has renamed the project e-HKD+. An official post from the MAS this week stated that the MAS hopes to use the new name to highlight the region’s deep research into the digital currency ecosystem.

Going forward, the HKMA plans to equip the e-HKD CBDC with programmability and offline payment capabilities. The Reserve Bank of India (RBI) recently took a similar step to enable eRupee CBDC to handle online fund transfers in areas with poor connectivity, while also giving businesses the opportunity to program CBDC to incentivize their salaried employees.

“The HKMA will continue to adopt a use-case-driven approach to exploring digital currencies,” HKMA Chief Executive Eddie Yue said in a prepared statement.

Another CBDC use case that Hong Kong is keen to explore is tokenized deposits. As a post on the Infosys blog explains, tokenized deposits can be defined as traditional bank deposits that have been converted into blockchain-based digital tokens.

“The results of the second phase will help the HKMA understand the practical issues it may face when designing, implementing and operating a digital currency ecosystem consisting of publicly and privately issued digital currencies. The HKMA said the e-HKD+ project will continue to advance technology and legal foundation work to support the possible future issuance of e-HKD for personal and corporate use.

In the second phase of the electronic Hong Kong dollar pilot, Hong Kong has accepted 11 groups of companies from different industries and 21 financial institutions. This phase of the electronic Hong Kong dollar trial is expected to last at least twelve months.

Countries such as China, Japan, Australia and Dubai are also adding a layer of unchangeable permanence to maintaining the financial records of their CBDCs, while reducing the global economy’s reliance on physical notes.

The International Monetary Fund (IMF) has proposed a framework aimed at promoting widespread adoption of CBDC, which emphasizes the need for regulation and education around CBDC, while also providing more programmability and some incentives for CBDC and its users. .