Hong Kong plans to pilot tokenized Exchange Fund Bills by 2026

Hong Kong has a habit of moving faster than people expect on digital finance. On September 16, the city’s Chief Executive John Lee Ka-chiu confirmed that the Hong Kong Monetary Authority will pilot the tokenization of Exchange Fund Bills by the end of 2026, targeting over HK$1.3 trillion worth of these instruments for operational testing. Exchange Fund Bills are short-term debt instruments issued by the HKMA and used by banks to manage their daily liquidity. Putting them on a distributed ledger means banks could theoretically use them around the clock, not just during the narrow windows that traditional settlement infrastructure allows. What is actually being tested here The pilot is framed explicitly as operational testing, not a full-scale rollout. The goal is to let banks use tokenized Exchange Fund Bills for asset and liability management via distributed ledger technology. Because blockchain-based systems don’t clock out at 5 p.m., banks gain continuous access to these instruments for liquidity purposes, which reduces the friction that builds up in overnight settlement queues. Running alongside this effort is the planned launch of CMU OmniClear, a new digital asset platform fro...