BOCI, an investment arm of the Bank of China, has announced the successful issuance of 200 million Chinese yuan ($28 million) in fully digital structured notes on Ethereum in Hong Kong. However, BOCI has become the first financial institution in China to issue a tokenized security on a public blockchain, as per the announcement.
The move results from BOCI’s cooperation with Swiss lender UBS, which originated the new product and offered them to its clients in the Asia-Pacific region.
The deputy CEO of BOCI, Ying Wang, stated:
“Working together with UBS, we are driving the simplification of digital asset markets and products, for customers in Asia Pacific through the development of blockchain-based digital structured products, designed specifically for customers in Asia Pacific.”
Additionally, Wang said Hong Kong’s digital economy looks very encouraging. Therefore, they are promoting Hong Kong’s financial industry’s innovative development and digital transformation.
Tokenized structured notes are blockchain-based financial products. They indicate the rights or ownership of the underlying asset. These products are managed and issued using blockchain technology.
Moreover, UBS also introduced a $50 million fixed-price token note in December 2022, under Swiss and English laws, on a permissioned blockchain. The firm also launched its own $370 million blockchain bonds on the Swiss Digital Exchange last year.
Hong Kong Is Attracting Crypto Giants
Hong Kong’s Securities and Futures Commission lifted its ban on crypto retail this month, allowing licensed platforms to serve retail investors in the region. However, companies such as BitMEX, OKX, and Huobi have indicated their willingness to apply for Hong Kong licenses.
Hong Kong’s Securities and Futures Commission has created clear guidelines for platform operators.
About two weeks later, Joseph Chan Ho-Lim, Undersecretary of Finance and Treasury, said Hong Kong is actively participating in the blockchain industry. However, the special administrative region wants to establish a regulatory framework for stablecoin regulation within a year.
The US SEC filed a lawsuit against the world’s top crypto exchanges, Binance and Coinbase, last week. Following the enforcement action, Hong Kong has now publicly invited Coinbase to run operations in the region under the city’s new licensing regime.
Johnny Ng, a Hong Kong legislator, stated:
“I hereby offer an invitation to welcome all global virtual asset trading operators including @coinbase to come to HK for application of official trading platforms and further development plans.”