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Homepage > News > Finance > HSBC issues digital bond; HKMA aligns OTC with European laws Hong Kong has become the global hub for digital bonds on the blockchain, with enabling regulations and an advanced investor base playing a major role. In yet another leap for the city-state, HSBC (NASDAQ: HSBC) has issued the first digitally native bond by a local private entity. On the regulatory front, the city’s two main financial watchdogs have pledged to align their digital asset over-the-counter (OTC) derivative rules with those of the European Union, as local laws aren’t robust enough for the sector. HSBC issues HK$1 billion digital bond HSBC has been championing the tokenization of the bond market globally; in February, it anchored Hong Kong’s $750 million digital bond, the first to fully rely on blockchain technology for issuance and management. Building on this experience, Hong Kong’s largest bank has issued a HK$1 billion (US$130 million) digital bond on its Orion blockchain platform. HSBC was the bond’s sole coordinator, fiscal agent, registrar and paying agent. The bond is a Hong Kong dollar-denominated digitally native note (DNN) with a fixed 3.6% rate due next year with a T+2 settlement window and is listed on the Hong Kong Stock Exchange (HKEX). The bank says it’s the first digitally native bond issued by a private entity in the city. It’s also the first digital bond issued under English law. “We expect to see increasing demand for digital bonds from the private sector if they can access the liquidity and scale seen on our HSBC Orion platform. We look forward to further developing this market,” commented John O’Neill, the head of digital assets at the bank. His colleague, Eugene Ng, who heads debt capital markets in Greater China, described the bond as yet another leap towards “the digitisation of Hong Kong’s capital market,…

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Filed under: News - @ October 4, 2024 5:06 am