Hong Kong Monetary Authority Invites Views on Retail CBDC

The Hong Kong Monetary Authority (HKMA) has issued a discussion paper inviting views on the key issues around a retail central bank digital currency (CBDC).

• The city's de facto central bank's "e-HKD: A policy and design perspective" paper focuses on the policy and design issues related to a digital Hong Kong dollar.
• The authority is studying the issuance mechanism, interoperability with other payment systems, privacy and data protection.
• The HKMA has previously studied the technical aspects of issuing a CBDC, the findings of which were published in October. The resulting paper studied potential architectures and design options as it relates to the construction of the infrastructure for distributing an e-HKD.
• Along with the HKMA, the central banks of almost every major economy worldwide are studying or developing CBDCs, in part as a means of future-proofing their currencies from potential threats posed by increased use of privately issued digital currencies.
• China is leading the way with its digital yuan - or eCNY - which had 260 million individual users as of January.
• Hong Kong maintains its own financial and judicial systems, separately from the Chinese mainland as part of the “One Country, Two Systems” framework under which Hong Kong is governed.

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