Hong Kong’s Banks Are Taking Lead on What e-HKD Will Look Like: Source
At least One bank seems to be inclined towards building it on a blockchain that requires permission.
Efforts are being made by Hong Kong to create their own central bank digital currency this year, with the decision regarding whether the ledger should be fully centralized or decentralized being left up to the banks by the regulator.
According to an official from a major bank who spoke to CoinDesk, the bank is considering developing an e-HKD on a permissioned blockchain.
In contrast to the e-CNY of the People’s Bank of China, the design of Hong Kong’s CBDC hasn’t been prescribed by the central government, as reported by the bank official based in Hong Kong, who was not authorized to discuss the matter publicly.
According to the source, the Hong Kong banks have been given the responsibility to review, research, and propose the implementation of the e-HKD by the regulator.
The source also stated that the public may not have a say in the development of the e-HKD. Last year, HKMA issued a discussion paper to gather opinions on issues related to a retail CBDC.
The security and privacy implications of the e-HKD issuance on a permissioned or permissionless chain are significant. In the case of a permissionless chain, although authorities can instruct banks to freeze accounts, if the individual withdraws their assets to a self-custody wallet, the authorities cannot seize them. However, on a permissioned chain, authorities have the power to seize such assets.
In Hong Kong, it is common to use cash for transactions, including when you need to hail a taxi, which typically necessitates having cash readily available.
