Asia Express – Cointelegraph Magazine

Visa completes e-HKD CBDC trial with HSBC and Grasp Seng 

Hong Kong is one step nearer to a central financial institution digital foreign money (CBDC) with the discharge of its profitable e-HKD part 1 ends in collaboration with Visa, HSBC, and Grasp Seng Financial institution.

In keeping with the November 1 announcement, Visa mentioned that it achieved “close to real-time” finality with transfers involving tokenized deposits of the digital Hong Kong greenback (e-HKD).

“Tokenized deposits have been burned on the sending financial institution’s ledger, minted on the receiving financial institution’s ledger, and concurrently settled interbank by way of the simulated wholesale CBDC layer,” the funds agency wrote.

“This would supply for settlement in an atomic method with higher streamlining of any operational dependencies imposed by monetary establishments and different intermediaries, thus enhancing liquidity administration.”

The fee processor additionally acknowledged that its e-HKD check pilot was purposeful 24/7, surpassing the uptime of conventional monetary methods, which generally don’t perform after hours or on weekends. As well as, the agency wrote that “tokenized deposits could be absolutely transacted whereas remaining encrypted, with out revealing details about identification, balances, or transaction quantities to non-bank customers.”

For its subsequent steps, Visa plans to discover using e-HKD in tokenized asset markets and programmable finance to automate actual property transactions. “On this pilot’s Property Funds use case, the fee from a purchaser transferring the remaining steadiness tokens to the property developer could also be automated upon reaching the completion date of the contract, minimising lag time in closure of the method,” the corporate mentioned. Different areas of analysis curiosity embody growth of retail options and digital cross-border funds.

Regardless of the promising outcomes, no particular timelines have been given for the complete launch of the e-HKD CBDC, and even that such a launch will happen. In its October 30report, the Hong Kong Financial Authority warned there are nonetheless points to resolve:

“As an illustration, an rCBDC issued as a programmable cash could also be extra prone to cybersecurity dangers, as it might current extra mediums for exterior threats to inject malicious code.”

With the silent nod from Beijing’s Central Authorities, Hong Kong has been striving to develop into a Web3 hub for blockchain within the Asia-Pacific Area. Nonetheless, such efforts had been overshadowed by the collapse of the JPEX crypto change, leading to losses exceeding $150 million for Hong Kong buyers. Because the incident unfolded, belief in cryptocurrency amongst native residents has fallen drastically. 

Hashkey’s regulated change token 

Hashkey, one of many first crypto exchanges to obtain a regulatory license in Hong Kong, will introduce an change token in 2024. 

In keeping with therecentwhitepaper, the “HashKey EcoPoints” (HSK) token will probably be minted on Ethereum with a complete provide of 1 billion. Out of this quantity, 65% is reserved for customers, 30% for Hashkey employees, and 5% for its ecosystem treasury.

The token will probably be distributed as incentivizes to ecosystem customers and distributors and won’t be “offered by way of non-public or public gross sales for fund elevating functions.” As for utility, the corporate states that the token could possibly be used to settle buying and selling charges, together with early entry to future token subscriptions and product upgrades on its change companies.

The change additionally pledges to buyback HSK tokens with as much as 20% of income generated from associated Hashkey companies. “HashKey implements an offsetting issuance mechanism (burning) to guard HSK holders from the dilutionary impression of rewards-based will increase in HSK circulating provide,” the agency wrote. Nonetheless, regulatory approval continues to be required for the token design plan:

“The contents of this whitepaper haven’t been reviewed by any regulatory authority in Singapore or Hong Kong. You might be suggested to train warning in relation to the knowledge on this whitepaper and any transaction that you just intend to hold out involving HSK.” 

In August, Hashkey, alongside crypto change OSL, acquired one of many first regulatory licenses for retail crypto buying and selling in Hong Kong. Its buying and selling quantity initially stagnated however has sincegainedtraction. Solely choose cash and tokens, reminiscent of Bitcoin, Ethereum, Tether, and Avalanche, are accepted to be listed on the change.

$308M syndicate manipulated crypto markets to launder cash: Police 

Nineteen Chinese language nationals have been sentenced for his or her position in a $308 million cash laundering scheme involving cryptocurrencies between November 2020 and April 2021. 

In keeping with an October 31 report by the Chongqing Tongliang District Individuals’s Court docket, Mr. Jiang and Mr. Deng, the principal conductors of the cash laundering syndicate, collectively laundered a complete of $308 million value of Bitcoin and Tether for proceeds of crime associated to on-line playing and wire fraud.

Police say that to keep away from platform monitoring and know-your-customer necessities, the accused people orchestrated a complicated scheme of utilizing peer-to-peer transactions, the place cash have been offered at “uncommon costs relative to identify markets” for stablecoin Tether after which transferred to exchanges for money.

“By fabricating pretexts reminiscent of withdrawing challenge funds and migrant employees’ wages, they organized gang members to withdraw money from financial institution counters in Chongqing, Sichuan, Shanghai and different provinces and cities. The amount of money withdrawals ranged from a whole lot of 1000’s to a number of million yuan every time. After withdrawing the money, the money is packaged in trolley circumstances, backpacks, and so on., and transported by aircraft.”

The 19 people, together with Mr. Jiang and Mr. Deng, have been sentenced to 6 months to 6 years in jail. “In recent times, the phenomenon of criminals committing unlawful and felony actions by telecommunications networks has develop into more and more rampant, posing an enormous menace to the respectable rights and pursuits of most of the people,” the presiding decide wrote. 

Resulting from such an increase in wire fraud involving cryptocurrencies, China’s Central Authorities has cracked down harshly on crypto-related actions within the nation, though there have been some indicators of leisure as of late. Nonetheless, such enforcement actions have generally resulted in collateral injury for overseas buyers utilizing Chinese language-based crypto companies with out felony intent. 

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Zhiyuan Solar

Zhiyuan Solar is a journalist at Cointelegraph specializing in technology-related information. He has a number of years of expertise writing for main monetary media shops reminiscent of The Motley Idiot, Nasdaq.com and In search of Alpha.