The subsidiary of Bank of China, BOCI, has achieved a significant milestone in the world of finance. They have announced the issuance of CNH 200 million worth of digital structured notes, becoming the first Chinese financial institution to issue a tokenized security in Hong Kong.
This groundbreaking move was made possible through a collaboration with UBS, a leading investment banking company. The product was specifically designed for clients in the Asia-Pacific region, highlighting the commitment to driving the simplification of digital asset markets and products.
In parallel, UBS has been actively expanding its tokenization efforts across various areas, including structured products, fixed income, and repo financing. Their previous success includes the issuance of a $50 million tokenized fixed-rate note in December 2022, utilizing English and Swiss law and digitized on a permissioned blockchain.
This development aligns with Hong Kong’s growing involvement in the blockchain industry. Recently, the region opened access to crypto exchanges for retail users and expressed its active participation in the blockchain space.Â
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Hong Kong has already made notable strides in tokenization. In February 2023, they issued an HK$800 million green bond tokenized on Goldman Sachs’ tokenization protocol GS DAP, offering an annual yield of 4.05%. Additionally, in December 2022, Hong Kong introduced two exchange-traded funds for cryptocurrency futures, raising over $70 million prior to their launch.
The collaboration between BOCI and UBS not only represents a significant milestone for tokenized securities in Hong Kong but also demonstrates the growing potential of blockchain technology in revolutionizing the financial landscape. With their combined expertise and dedication to innovation, both institutions are poised to drive further advancements in the field of digital finance.
