Hong Kong to get world's first tokenised money market ETFs from Bosera and HashKey
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The duo said in a statement on Friday that they would add new tokenised share classes to two existing money market ETFs – Bosera HKD Money Market ETF and USD Money Market ETF – providing both retail and institutional investors with a low-risk, blockchain-based liquid investment option. The ETFs, which have been approved by the Securities and Futures Commission, will be launched in April.
Through tokenisation, the rights to an asset, such as a money-market fund, are converted into a digital token that can be traded on a distributed ledger technology network. Money market funds typically invest in low-risk, short-term debt securities such as commercial paper and treasury bills, providing liquidity and preserving capital while offering returns. Money market ETFs offer similar benefits but often have higher trading flexibility on stock exchanges.
'[Compared with] traditional money market funds, this product greatly improves transparency and operational efficiency through blockchain technology, enabling investors to gain direct exposure to high-quality money market instruments by tokens, thereby fulfilling their asset allocation and risk management needs,' the firms said.
Tokenisation has the potential to make financial transactions more efficient, transparent and less costly, according to HKMA chief executive Eddie Yue. Photo: Jonathan Wong
Tokenised money market ETFs are one of the use cases in the Hong Kong Monetary Authority's (HKMA)
Project Ensemble sandbox , which explores the tokenisation of real-world assets (RWAs) and facilitates a new financial market infrastructure that involves digital money and assets. Tokenisation has the potential to make financial transactions more efficient, transparent and less costly, Eddie Yue Wai-man, chief executive of HKMA, said last August at the launch of the sandbox.
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