Hong Kong’s HKMC Raises HK$12bn In Record Digital Bond Sale
The Hong Kong Mortgage Corporation (HKMC) has raised about HK$12 billion ($1.5 billion) through its inaugural digital bond issuance, marking the world’s largest digital bond sale to date and another step in Hong Kong’s efforts to establish itself as a global hub for tokenised finance.
The transaction, priced on June 10 under HKMC’s US$30 billion Medium Term Note Programme, also makes the government-owned financial institution the first public sector entity in Hong Kong to issue digital bonds.
The offering comprised three tranches: HK$6 billion of two-year notes, HK$2.5 billion of five-year notes and CNH3 billion of three-year bonds.
The five-year Hong Kong dollar tranche is the longest-tenor HKD-denominated digital bond issued so far, setting a new benchmark for the local market.
HKMC said the issuance attracted a peak order book of around HK$24 billion equivalent from more than 100 investors, including central banks, multilateral development banks, commercial banks, insurers, private banks, and asset managers.
Investors from Hong Kong, mainland China’s Southbound Bond Connect scheme and overseas markets participated in the offering.
The bonds were issued in a digitally native format using a distributed ledger technology platform operated by Hong Kong’s Central Moneymarkets Unit (CMU), which also handles clearing and settlement.
The transaction builds on the digital bond framework pioneered by the Hong Kong government in recent years and highlights the city’s broader push to integrate blockchain technology into traditional capital markets.
One practical benefit of the issuance was a reduction in the settlement cycle from five business days to three, a feature market participants believe could improve operational efficiency and reduce transaction risks.
The deal comes as regulators and financial institutions globally explore tokenisation as a way to modernise bond markets.
While digital bonds still represent a small share of overall debt issuance, governments and development banks have increasingly used pilot transactions to test blockchain-based settlement and custody systems.
Hong Kong has emerged as one of the more active jurisdictions in the space, promoting tokenised green bonds, digital asset regulation and initiatives aimed at linking traditional finance with blockchain infrastructure.
Howard Lee, Deputy Chief Executive of the Hong Kong Monetary Authority and Executive Director of HKMC, said the issuance supports the government’s strategy of strengthening Hong Kong’s position as a global fixed-income and currency hub while accelerating the adoption of tokenisation technology in debt markets.
Analysts say the size of the transaction and the participation of a broad institutional investor base could encourage other public-sector and corporate issuers to consider digital bond offerings, helping move tokenisation from pilot projects toward mainstream capital markets.
