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BOCI, the investment bank subsidiary of Bank of China, has made a groundbreaking move by issuing 200 million Chinese yuan ($28 million) worth of digital structured notes on the Ethereum blockchain. This makes BOCI the first Chinese financial institution to tokenize a security in Hong Kong.
The securitized tokens will be governed by Hong Kong and Swiss law.
The issuance was facilitated in collaboration with UBS, a leading investment banking company, which has been actively expanding its tokenization efforts in structured products, fixed income, and repo financing. UBS previously issued a $50 million tokenized fixed-rate note under English and Swiss law on a permissioned blockchain.
Speaking about the issuance, the deputy of BOCI, Ying Wang, said:
“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.”
In addition to these developments, Hong Kong has been making significant strides in the blockchain and cryptocurrency space. It has also introduced two cryptocurrency futures exchange-traded funds, raising over $70 million.
Hong Kong has been fostering a favorable environment for cryptocurrencies, opening up crypto exchange access for retail users and expressing its active participation in the blockchain industry. Also, the government aims to establish a regulatory framework for stablecoins within the next year, demonstrating its commitment to embracing emerging technologies and fostering innovation in the financial sector.