A new initiative has been introduced by the Hong Kong Monetary Authority (HKMA) to support banks adopting distributed ledger technology (DLT).
The program, known as the “Supervisory Incubator for Distributed Ledger Technology”, was announced on January 8 during the FiNETech4 event, which gathered over 300 finance professionals.
Arthur Yuen, HKMA’s deputy chief executive, emphasized the need to create an environment that encourages innovation while ensuring safety. He explained that the program is designed to help banks explore DLT solutions in a way that benefits the industry and the wider community.
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The initiative focuses on two main areas. First, the program aims to foster growth across the banking sector by conducting research, sharing practical advice, and providing clear guidance on implementing DLT.
This collaborative approach is expected to help banks understand and adopt the technology more effectively.
Second, the program offers individual support to banks by providing feedback during live trials of DLT systems. This includes assessing risk management processes before services are fully launched.
The initial trials will focus on tokenized deposits, which test the systems to ensure they operate securely and efficiently.
Carmen Chu, Executive Director at HKMA, highlighted the potential of DLT to improve financial processes. She noted at the FiNETech4 event:
As DLT continues to evolve, we could expect to witness more sophisticated ways of managing tokenized assets, such as real-time ledger updates, autonomous book-keeping and streamlined reconciliation processes.
Chu also said that these innovations could create new financial products tailored to the needs of specific industries, which offers banks opportunities for growth.
While Hong Kong announced its DLT initiative, Oklahoma Senator Dusty Deevers recently introduced a new payment law for residents and businesses. What is it about? Read the full story.
Having completed a Master’s degree in Economics, Politics, and Cultures of the East Asia region, Aaron has written scientific papers analyzing the differences between Western and Collective forms of capitalism in the post-World War II era.With close to a decade of experience in the FinTech industry, Aaron understands all of the biggest issues and struggles that crypto enthusiasts face. He’s a passionate analyst who is concerned with data-driven and fact-based content, as well as that which speaks to both Web3 natives and industry newcomers.Aaron is the go-to person for everything and anything related to digital currencies. With a huge passion for blockchain & Web3 education, Aaron strives to transform the space as we know it, and make it more approachable to complete beginners.Aaron has been quoted by multiple established outlets, and is a published author himself. Even during his free time, he enjoys researching the market trends, and looking for the next supernova.
