Yesterday the Hong Kong Monetary Authority (HKMA) shared its roadmap for developing its retail central bank digital currency (CBDC), the e-HKD. This marks Hong Kong’s transition from the research to the development phase of the CBDC.
The central bank believes it will take two to three years to develop the interbank layer for the two-tiered consumer-focused CBDC. However, SCMP reported trials to start in the fourth quarter, which might refer to use case experiments versus infrastructure. Additionally, the central bank stated it would explore using CBDC as an on and off-ramp for DeFi.
The central bank outlined a three path approach to development. The first is the foundational infrastructure, including the wholesale layer, which the central bank will use to enable the distribution of the retail CBDC with banks as intermediaries. HKMA expects to take nine months to design this and two to three years to develop it. There are also plans for a legislative program to enable e-HKD issuance.
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