Digital bonds are now being issued in Hong Kong as part of a new grant program.

Hong Kong Monetary Authority Launches Grant Program for Digital Bond Issuers

The Hong Kong Monetary Authority (HKMA) has announced the launch of a grant program aimed at supporting the growth and innovation of digital bond issuance in the region. The program, which runs for three years, offers financial support to entities that issue digital bonds, facilitating their entry into the digital bond market.

Under the program, the HKMA defines a digital bond as a bond that uses distributed ledger technology (DLT) for digital representation of ownership. This definition is broader than traditional usage, encompassing bonds issued using DLT, as well as tokenized bonds.

The grant program offers up to HK$2.5 million (US$ 321,000) in grants per issuer. The subsidy provided by the HKMA will cover up to half the expenses of each digital bond issuance. The program is open to issuers of tokenized bonds, in addition to traditional digital bond issuers.

The HKMA's grant program is designed to support the issuance of digital bonds, with a focus on fostering the development of the digital bond market in Hong Kong. It is also intended to help entities reduce the costs associated with digital bond issuance.

The program is structured to provide funding for digital bond issuances that leverage innovative technologies and approaches. It is worth noting that the HKMA supports digital bond issuance subsidies specifically for companies and institutions participating in its pilot programs for digital bond issuance through the Hong Kong platform; detailed names are not explicitly listed in the search results provided.

The grant program covers expenses associated with digital bond issuances beyond the initial two issuances per recipient. However, a maximum of two issuances per recipient is allowed under the program.

The HKMA's grant program is part of a broader initiative to promote digital transformation in the financial sector. It encourages the use of DLT for digital bond issuances, reflecting the HKMA's commitment to leveraging technology for the advancement of the financial industry.

The grant program for digital bond issuers by the HKMA has no limit on the number of eligible applicants, making it accessible to a wide range of entities interested in digital bond issuance. This initiative is expected to contribute significantly to the growth and development of the digital bond market in Hong Kong.