The Hong Kong Monetary Authority (HKMA) started working on a potential CBDC that would be available for the public. The plans for a digital Hong Kong dollar appeared in June this year.
The HKMA has strengthened its research work on the retail CBDC and published on Monday a technical whitepaper that is part of the technology study. The aim of this technical whitepaper is to explore potential architectures and design options of the digital version of the currency.
The project envisaged a two-tier distribution model of the retail digital currency: the wholesale layer, in which only intermediaries (banks and payment service providers) can participate and the retail layer that should be open to the general public. The role of the central bank would be to issue and redeem retail CBDC, whereas the role of commercial banks would be to distribute and circulate the CBDC.
CEO of the HKMA Eddie Yue said that the whitepaper is the first step to assess the feasibility of the e-HKD. He also added that “the knowledge gained from this research, together with the experience we acquired from other CBDC projects, would help inform further consideration and deliberation on the technical design of the e-HKD."
In the proposed design architecture the HKMA points several areas that need to be discussed further. These areas have been summed up as seven problem statements: privacy, interoperability, performance and scalability, cybersecurity, compliance, operational robustness and resilience, and technology-enabled functional capabilities.
Everyone from academia and industry is invited to comment on the proposed design of e-HKD. Feedback can be submitted by 31. December 2021.
The Hong Kong Monetary Authority has also been studying the potential of wholesale central bank digital currency for cross-border payments since 2017.
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*Khatri, Yogita (4. Oktober 2021). The Block: Hong Kong explores technical aspects of a retail CBDC. Last viewed on 06.10.2021 on https://www.theblockcrypto.com/post/119389/hong-kong-hkma-technical-whitepaper-retail-cbdc
