Exploring Hong Kong's e-HKD CBDC and Its Innovative Features Inspired by India's eRupee

Overview of Hong Kong’s e-HKD CBDC Development

Hong Kong is actively accelerating efforts to give its fiat currency, the Hong Kong Dollar (HKD), a blockchain revamp. The special administrative region (SAR) of China has launched its e-HKD central bank digital currency (CBDC) into the second elaborate phase of trials. Following the footsteps of the Reserve Bank of India, the authorities in Hong Kong are now laying focus on adding multiple layers of usable features to the CBDC to make its utilisation more lucrative for the end users.

Innovative Features and Use Cases

With the CBDC initiative entering its second phase, the Hong Kong Monetary Authority (HKMA) has renamed the project as e-HKD+. With its new name, the authority is looking to highlight the region's deeper dive into the digital money ecosystem.

• HKMA plans to lace the e-HKD CBDC with programmability and offline payments features.
• A framework for CBDC adoption suggested by the International Monetary Fund aims at widespread adoption of CBDCs.

Collaborative Efforts and Future Outlook

For the second phase of trials, Hong Kong has onboarded 11 groups of firms from various sectors alongside 21 financial institutions. This phase of the e-HKD trials is expected to last for at least twelve months. Other global leaders, such as China, Japan, Australia, and Dubai, are also progressing in CBDC development.

By adopting a use-case driven approach, the HKMA aims to navigate the practical issues in designing, implementing, and operating a digital money ecosystem. Project e-HKD+ is set to advance the technology and legal groundwork for future individual and corporate use of an e-HKD.