The Hong Kong Monetary Authority has launched the Project Ensemble Sandbox, a new financial market infrastructure designed to let banks and industry participants experiment with asset tokenization and settlement using experimental tokenised money. The Sandbox supports interbank settlement for both payment-versus-payment and delivery-versus-payment transactions, with participating banks connecting their own tokenised deposit platforms to this shared environment. It builds on Project Ensemble, initiated in March 2024, which explores wholesale central bank digital currency (wCBDC) and tokenised deposits as the backbone for tokenised asset markets in Hong Kong. For its initial phase, the Sandbox will focus on four themes: tokenisation of fixed income and investment funds, liquidity management, green and sustainable finance, and trade and supply chain finance, reflecting areas where tokenisation is seen as most likely to deliver efficiency and transparency gains. Through these pilots, the HKMA aims to test technical interoperability among tokenised assets, tokenised deposits and wCBDC, generate practical standards and protocols for the industry, and inform the development of common benchmarks for tokenisation in Hong Kong’s financial sector. The Sandbox is structured as a controlled environment, allowing regulators, banks, technology providers and other members of the Project Ensemble Architecture Community to co-develop market infrastructure and standards that could underpin future large-scale use of tokenised assets.

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