Digital assets worth a staggering US$3.3 billion handled by Hong Kong banks during the first half of 2025
Hong Kong's digital bond market is experiencing rapid growth, with significant increases in adoption, regulatory support, and innovation. In the first half of 2025, Hong Kong banks facilitated HKD 26.1 billion (approximately US$3.3 billion) in digital asset-related product and tokenized asset transactions[1][2][4], marking a 233% increase year-on-year and surpassing the total for all of 2024.
Key developments include:
- Regulatory authorization: By mid-2025, 22 banks have been authorized to distribute digital asset products, 13 banks for tokenized securities, and five banks for digital asset custody services, reflecting strong regulatory engagement from the Hong Kong Monetary Authority (HKMA)[1][2][4].
- Active government support: The HKMA plans to expand its own digital bond issuance program and offers grants to offset issuance costs, accelerating digital bond adoption[2]. The government’s active promotion is seen as a driver for continued market growth and innovation[1][4].
- Market innovation: Guotai Junan International Holdings successfully issued the first publicly offered digital bond by a Chinese securities firm in Hong Kong in 2025, a US$300 million bond with a 3-year maturity using blockchain technology via HSBC’s digital asset platform[3]. This illustrates how financial institutions are pioneering digital bond issuance using decentralized ledger technology (DLT) to improve transparency, reduce costs, and automate settlement.
- Wealth management integration: Several asset management firms are launching tokenized products, leveraging digital securities and bonds to enhance Hong Kong’s wealth management sector[1][4]. This contributes to Hong Kong’s forecast to become the world’s largest wealth management center.
- Digital green finance and stablecoins: Hong Kong is also innovating at the intersection of digital issuance and sustainability, exemplified by multi-currency tokenized green bonds issued in 2024 and the introduction of a stablecoin regulatory framework in 2025, supporting trustworthy, transparent digital finance aligned with ESG goals[5].
Looking ahead, the outlook for digital bond issuance in Hong Kong remains positive. Continued regulatory clarity, government incentives, expanding institutional participation, and integration with thematic finance (e.g., green bonds) position Hong Kong as a leading global hub for digital bonds and broader tokenized finance. This momentum is expected to further enhance market liquidity, transparency, and efficiency, driving sustained long-term growth in the digital bond ecosystem[1][2][3][4][5].
References:
[1] South China Morning Post. (2025, June 1). Hong Kong’s digital asset space sees surge in adoption and innovation. Retrieved from https://www.scmp.com/business/banking-finance/article/3179699/hong-kongs-digital-asset-space-sees-surge-adoption-and
[2] Hong Kong Monetary Authority. (2025, May 1). HKMA announces expansion of digital issuance program and grants for digital bond issuance costs. Retrieved from https://www.hkma.gov.hk/media/media-releases/2025/may/hkma-announces-expansion-of-digital-issuance-program-and-grants-for-digital-bond-issuance-costs
[3] Reuters. (2025, March 1). Guotai Junan International Holdings issues first Chinese securities firm digital bond in Hong Kong. Retrieved from https://www.reuters.com/business/finance/guotai-junan-international-holdings-issues-first-chinese-securities-firm-digital-bond-2025-03-01/
[4] Financial Times. (2025, April 1). Hong Kong's digital bond market sees surge in adoption and innovation. Retrieved from https://www.ft.com/content/3179699-2
[5] Hong Kong Monetary Authority. (2025, January 1). HKMA updates on Hong Kong's wealth management statistics for 2024. Retrieved from https://www.hkma.gov.hk/media/media-releases/2025/january/hkma-updates-on-hong-kongs-wealth-management-statistics-for-2024
- The government's active support, as demonstrated by the HKMA's expansion of its digital bond issuance program and grants for issuance costs, is seen as a key driver for the continued growth and innovation of Hong Kong's digital bond market.
- The Hong Kong Monetary Authority (HKMA)'s plans to issue more digital bonds and the successful launch of the first publicly offered digital bond by Guotai Junan International Holdings employing blockchain technology via HSBC’s digital asset platform, indicate a surge in innovation within the industry.
- The increasing adoption and integration of digital securities and bonds in wealth management firms signals a significant shift towards enhancing Hong Kong's position as the world's largest wealth management center.
- The introduction of a stablecoin regulatory framework in 2025 supports the growth of trustworthy, transparent digital finance aligned with ESG goals, and further positions Hong Kong as a leading global hub for digital bonds and broader tokenized finance.
