 | Get all the essential market news and expert opinions in one place with our daily newsletter. Receive a comprehensive recap of the day's top stories directly to your inbox. Sign up here! |
(Kitco News) - BOCI, an investment bank owned by Bank of China, a state-owned bank that serves domestic and overseas clients, has announced the successful issuance of a CNH 20 million digital structured note on the Ethereum blockchain, becoming the first Chinese financial institution to issue a tokenized security in Hong Kong.
According to an announcement from BOCI, the new product was originated by UBS and offered to its clients in Asia Pacific in a move that represents the start of a long-term collaboration between BOCI and UBS in the digital structured note space.
“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,” said Ying Wang, Deputy CEO of BOCI. “We are encouraged by the evolution of Hong Kong's digital economy and are committed to promoting the digital transformation and innovative development of Hong Kong's financial industry.”
The Ethereum-based note is the first regulated securities product of its kind issued under Hong Kong and Swiss law in the Asia Pacific region. In December, UBS issued a USD 50 million tokenized fixed-rate note under English and Swiss law that was digitized on a permissioned blockchain.
This new product marks the continued expansion of tokenized service offered by UBS through UBS Tokenize, which the firm has been applying to various structured products, fixed income and repo financing.
“We are pleased to work with BOCI on this transaction to bring structured products onto a public blockchain network, supporting our APAC clients’ increasing interest in fully regulated digital asset products,” said Aurelian Troendle, Global Head of MTN Trading at UBS AG. “High-frequency issuance activity can benefit from vast efficiency gains through the use of blockchain technology, which will ultimately bring advantages to investors. UBS is excited to work with issuers like BOCI to broaden our client offering through our tokenization capabilities. “
|
| BNP Paribas partners with Bank of China to boost digital yuan for business |
Hong Kong offers an invitation to Coinbase
Following last week’s enforcement action by the U.S. Securities and Exchange Commission against Coinbase, the top U.S.-based cryptocurrency exchange, Hong Kong has now put out an open invitation to the exchange to set up shop in the region under the city’s new licensing regime for crypto retail trading.
“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,” tweeted Johnny Ng, a member of Hong Kong’s Legislative Council and Chinese People’s Political Consultative Conference. “Please feel free to approach me and I am happy to provide any assistance.”
Following months of development and public consultations, Hong Kong put new guidelines for virtual asset trading platform operators into effect on June 1, enabling regulated retail trading of digital assets in the city. Included in the guidelines are requirements for the safe custody of assets, segregation of client assets, avoidance of conflicts of interest, and cybersecurity standards and requirements expected of licensed trading platforms
“This is a very big moment, a big milestone for Hong Kong, not just for the industry, but also for investors,” said Gary Tiu, executive director and head of regulatory affairs at Hong Kong-based crypto exchange OSL at the time. “Retail investors have been looking at the regulated industry but unable to participate for the last two years. Now, all the protections that Hong Kong has built – client asset protection, capital requirements, insurance requirements, and cyber security controls – are going to be available to retail investors.”
Tiu added that the new regulatory regime has created an “equal playing field in the Hong Kong market,” which is “a good thing for Hong Kong and for investors. I think it will also be a very important reference point for other markets to study as well,” he said.
This invitation to Coinbase is a sign that Hong Kong is willing to consider licensing firms from all parts of the globe, and is committed to establishing itself as a global cryptocurrency hub and the gateway to China’s growing blockchain industry.
