The Government of the Hong Kong Special Administrative Region of the People’s Republic of China (HKSAR) announced the pricing of HK$10 billion (USD$1.3 billion) of digital green bonds, marking the largest-ever digital bond issuance in the world to date.
A digital green bond, or a tokenized green bond, is a green bond that is represented on a blockchain network. Investors trade the bonds on the blockchain-based exchange and principal and interest are paid on the blockchain. Digital bonds offer benefits including increased transparency and traceability, as well as faster transactions and settlements.
According to the HKSAR Government, demand for the bonds was very strong, with the total subscription reaching over HK$130 billion (USD$16.7 billion). The offering included four tranches, denominated in currencies including HK dollars, Renminbi, US dollars, and euro.
The offering marks the third in a series of digital green bond issuances by the HKSAR Government, following an initial HK$800 million tokenized green bond issuance in early 2023, and a second HK$6 billion issuance in 2024.
The government highlighted a series of innovative features that it added to its third offering, including the integration of digital money in the settlement process, with options for the HKD and RMB tranches to settle via tokenized central bank money, and the adoption of Digital Token Identifiers for all tranches of the issuance.
Mr Eddie Yue, the Chief Executive of the Hong Kong Monetary Authority, said:
“With each issuance of the HKSAR Government’s digital bonds since 2023, we have sought to further scale the market and explore new innovations, to reinforce the vision for Hong Kong to become a global hub for digital assets.”
