Hong Kong issues world's first government tokenized green bonds worth $102 million
The Hong Kong government has successfully issued the world's first HK$800 million ($102 million) tokenized green bonds. Tokenizing a bond means transferring beneficial interests into bonds using distributed ledger technology rather than traditional bonds.
One-year tokenized green bonds, denominated in Hong Kong dollars, were offered at 4.05% to global institutional investors after virtual roadshows hosted by Bank of China, Credit Agricole, Goldman Sachs and HSBC.
"The successful issuance of this tokenized green bond marks an important milestone, as it demonstrates Hong Kong's strengths in bringing together the bond market, green and sustainable finance, and financial technology," said Financial Secretary Paul Chan Mo Po.
According to Bank of China Vice Chairman and Chief Executive Officer Sun Yu, the green bond issue has attracted great interest from institutional investors and serves as a testament to the diversity and innovation of Hong Kong's financial market.
"As the first tokenized bond regulated by Hong Kong law, the offering demonstrates that Hong Kong's legal and regulatory environment is flexible and conducive to innovative forms of bond issuance," the government said in a statement.
Last October, Hong Kong unveiled a series of measures, including offering tokenized green bonds and allowing retail investors to trade digital assets to turn the city into a virtual asset trading hub. In addition, Hong Kong officials have unveiled plans to expand the range of crypto-assets available and have also considered how to open up the cryptocurrency market to retail investors.
In addition, Hong Kong will introduce compulsory licensing for Stablecoin issuers during 2023-2024. Specifically, the Hong Kong Monetary Authority (HKMA) will ban the use of algorithmic staplecoins like Terra USD (UST), which led to the cryptocurrency market crisis in the spring of 2022. The regulator is going to oversee the management, issuance and retention of fiat tokens.