The Hong Kong government has issued 800 million HKD ($102m) in tokenised green bonds as part of its Green Bond Programme.
The programme is part of a government initiative designed to promote sustainability within the city’s finance and bond markets.
The bonds were underwritten by four banks and priced at a yield of 4.05%.
According to the announcement, the platform used Goldman Sachs’ tokenisation protocol, GS DAP, for the bond.
GS DAP uses a private blockchain network to settle security tokens representing the beneficial interests of bonds and cash tokens representing claims on the Hong Kong dollar.
Tokenisation refers to the use of blockchain technology to create digital tokens which issuers can use to make issuing and trading securities more transparent and efficient.
The move towards digitally settling bonds on private blockchain networks marks a major shift from traditional finance, which typically requires manual verification and paperwork.
Paul Chan, Hong Kong’s Financial Secretary, believes the successful issuance of tokenised green bonds is an important milestone for the city.
“Hong Kong has been actively promoting the application of innovative technologies in the financial sector, actively exploring new concepts and technologies to improve the efficiency, transparency, and security of financial transactions,” he said.
The issuance of tokenised green bonds highlights the increased adoption of blockchain technology in traditional finance and leads the way for further development of sustainable finance practices around the globe.
Hong Kong’s government has seemed focused on its commitment to developing digital asset infrastructure in recent months.
In December 2022, the city launched two exchange-traded funds (ETFs) for cryptocurrency futures, raising more than $70 million prior to debuting.
Tags: bonds, Hong Kong, sustainability, tokenisation
