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Exclusive | Hong Kong e-HKD trials explore ‘interesting use cases’ of digital currency in payments, investments: HKMA boss

  • Programmable payments to protect consumers’ cash and tokenised assets are some of the scenarios in trials, Eddie Yue says
  • The relevant players need more experience with the digital currency before a timeline for launch can be determined, he says

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Central banks worldwide are exploring the use of digital currencies. Photo: Shutterstock
Enoch Yiu

Hong Kong’s trials of a digital currency called e-HKD have showed potential uses in payment, deposit and investment scenarios, but relevant players need more experience before a launch date can be considered, according to the head of the city’s de facto central bank.

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“There are some interesting use cases of e-HKD in the areas like programmable payments, and in new areas like tokenised deposits and tokenised assets,” Eddie Yue Wai-man, CEO of the Hong Kong Monetary Authority, said in an interview with the Post.
Hong Kong in May launched a trial run for 16 banks and payment companies to test the digital currency with select small groups of clients, the first step towards introducing a virtual coin the public will eventually use to shop, dine out and transfer money.

In a programmable payment scenario, rules encrypted in the digital currency restrict the use of the money. This could, for example, ring-fence a consumer’s money on deposit with a merchant, protecting it in case of the merchant’s collapse.

Eddie Yue Wai-man, CEO of the Hong Kong Monetary Authority (HKMA), pictured in the SCMP office in Causeway Bay on October 5, 2023. Photo: Nathan Tsui
Eddie Yue Wai-man, CEO of the Hong Kong Monetary Authority (HKMA), pictured in the SCMP office in Causeway Bay on October 5, 2023. Photo: Nathan Tsui

Bank of China (Hong Kong) conducted a trial of the feature earlier this month, the lender said on October 3. The bank said it has teamed up with 10 firms allowing customers to use e-HKD to prepay for coupons for facial treatments, gym memberships, classes and medical treatments.

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