In response to the ever-increasing uncertainty in the cryptocurrency market, the widespread use of Central Bank Digital Currency (CBDC) has been on the rise. To counter this, Hong Kong has joined the ranks of countries that have been developing CBDCs.
A rollout of the “digital Hong Kong dollar” is reportedly in the works at the Hong Kong Monetary Authority (HKMA). CEO of HKSAR Lee Ka Chiu John said he is looking at the market’s perspective on stablecoin regulation. The government has officially begun laying the groundwork for the introduction of the Digital Hong Kong Dollar.
Authorities Focusing on Regulations
He also said that a plan for introducing virtual asset licensing legislation has been filed by the government. The Monetary Authority, on the other hand, is sent out to learn about stablecoin regulation from the market’s point of view.
This is done to ensure that the rules are consistent with regulatory best practices from across the world. However, consideration is being given to local conditions when the regulations are drafted.
Monetary authorities in Hong Kong have initiated the first steps toward launching the digital Hong Kong dollar. While the authority is coordinating with the institution on the Mainland to increase the number of tests administered.
According to a study published by the International Monetary Fund (IMF) earlier this year, about one hundred different nations have shown an interest in CBDC. However, government-issued currencies are still in the prototyping or testing phases.
Nigeria and the Bahamas are the only two nations so far to have completely launched their CBDC. The CBDC pilot program in 15 countries will continue through July 2022. Even though fifteen more are in the concept phase right now. Nonetheless, some 65 countries are just in the assessment stage at the moment.
