e-HKD Pilot Programme Ends: HKMA’s Wholesale Pivot for Banks

On 28 October 2025 the Hong Kong Monetary Authority published the e-HKD Pilot Programme Phase 2 Report and, with it, drew a line under three years of retail testing. The report sets out the HKMA’s latest policy stance on Hong Kong’s central bank digital currency: the immediate priority for the e-HKD sits in wholesale settlement and tokenisation. A general-purpose retail e-HKD for individuals and corporates is now conditional, subject to a business case that the pilots did not establish.

For a Hong Kong bank, stored value facility licensee or technology firm that spent 2024 and 2025 inside the pilot, that is a planning signal worth reading precisely. The e-HKD itself survives. The HKMA has re-sequenced the work, put wholesale first, and named the artifacts it will deliver next. The report supports shifting near-term attention towards wholesale use and tokenisation rather than assuming a near-term retail launch. The Phase 2 Report set the first half of 2026 as the target for separate publication of the Industry Forum’s common token standards; the HKMA’s current CBDC page still describes those standards as forthcoming.

Related reading: HKMA Project Ensemble and tokenised deposits

What the e-HKD Pilot Programme decision settled

The Phase 2 Report closes the programme after two phases and confirms a direction rather than a launch. Since 2017 the HKMA has explored an e-HKD as Hong Kong’s CBDC, using distributed ledger technology, across both wholesale and retail scenarios. Phase 1, completed in October 2023 with 16 pilot participants, tested whether an e-HKD could be technically usable. Phase 2, run through 2024 and 2025 with 11 groups of firms from the financial, payment and technology sectors, tested whether it would be useful in commercial terms, across three study themes: settlement of tokenised assets, programmability, and offline payments.

The conclusion is that the risk-free character of a central bank liability matters most where credit risk bites hardest, which is large-value wholesale activity. The HKMA will therefore prioritise developing the e-HKD for financial institutions in wholesale scenarios, where it has already been used for interbank cross-border transactions, and use it to support the tokenisation ecosystem and cross-border payments such as settlement of international trade. Retail extension remains on a preparatory footing. The Phase 2 Report set the first half of 2026 as the target for policy, legal and technical groundwork; the report made the timeframe for any such extension subject to international developments, latest technologies and market needs; the first-half-of-2026 target for that groundwork has since elapsed and warrants current-status verification.

The word to hold onto is priority. Wholesale is the near-term build; retail is a reviewed option with its groundwork now being prepared.

The e-HKD timeline that matters for 2026 planning

Most of this history is context. Two entries are live planning inputs. Here is the sequence the report set out. The first-half-of-2026 entries are now historical target dates and should not be presented as forward dates.

• 2017: HKMA begins CBDC exploration for an e-HKD.
• June 2021: Project e-HKD launched to assess retail feasibility for individuals and corporates.
• September 2022: the HKMA publishes “e-HKD: Charting the Next Steps”, setting out a three-rail approach for potential retail implementation.
• October 2023: Phase 1 of the pilot completed with 16 participants.
• March 2024: Project Ensemble launched to support the tokenisation ecosystem, including interbank settlement of tokenised deposits.
• September 2024: the project is renamed Project e-HKD+, widening scope to the broader digital money ecosystem.
• December 2024: the e-HKD Industry Forum is established under Project e-HKD+.
• 1 August 2025: the Stablecoins Ordinance (Cap. 656) comes into effect, licensing fiat-referenced stablecoin issuers.
• 28 October 2025: Phase 2 Report published; the pilot completes and the wholesale priority is set.
• First half of 2026: target stated in the Phase 2 Report for retail policy, legal and technical groundwork and for separate publication of the Industry Forum’s common token standards; subsequent HKMA material continues to describe the retail groundwork as ongoing, while the current CBDC page continues to describe publication of the standards as forthcoming.

The two first-half-of-2026 entries were planning targets when the report was published; they now require current-status verification rather than treatment as future milestones. Everything above them is the record of how the HKMA reached the wholesale-first stance.

Why wholesale won, and why retail did not

The reasoning in the report is commercial. The pilots showed that an e-HKD could make retail payment processes more efficient and unlock new transaction types. They also showed that privately issued digital money, particularly tokenised deposits, can deliver comparable benefits in retail settings. A key finding was that the public perceived an e-HKD and tokenised deposits similarly, because trust in Hong Kong’s banking system is already high, underpinned by the supervisory regime and safety nets such as the Deposit Protection Scheme. That trust lowers a retail user’s sensitivity to the credit-risk difference between public and private money, which is the e-HKD’s main structural advantage.

Commercial banks in the pilots showed a slight preference for tokenised deposits over an e-HKD. The report attributes this to a potentially lower cost of capital for tokenised deposits under the fractional banking system, more design flexibility and a shorter time-to-market, and the customer stickiness a bank-issued instrument creates. Against an already mature and well-served retail payment market, the report concludes that the incremental benefit of a retail e-HKD might not substantially outweigh the operational challenges, and that no sustainable business model has yet emerged to make the private sector want to implement it.

Wholesale is the mirror image. There, the absence of credit risk is a clear advantage over privately issued digital money, and a central bank liability can act as a monetary anchor that secures what the report calls the “singleness of money”, the property that a dollar of one form settles at par against a dollar of another. That anchoring role is what makes the wholesale case strong enough to prioritise now.

A team reading this should resist the shorthand that the e-HKD “failed”. The pilots delivered a finding, and the finding was that the retail value proposition is contingent while the wholesale one is present. Those are different conclusions with different consequences for where a bank spends its tokenisation budget.

Project Ensemble is where the near-term work sits

Project Ensemble remains the HKMA’s wholesale tokenisation programme. Launched in March 2024, it was followed in November 2025 by EnsembleTX, the pilot phase designed to facilitate real-value transactions involving tokenised deposits and digital assets throughout 2026. The Phase 2 Report separately states that further e-HKD studies and pilots may be conducted both within and outside Project Ensemble.

The market context that Ensemble plugs into is already concrete. The HKMA has issued two batches of tokenised green bonds, HK$800 million in February 2023 and around HK$6 billion in February 2024, following Project Genesis and Project Evergreen. In 2025 the industry introduced Hong Kong’s first tokenised deposit product and its first retail tokenised money market fund. An industry whitepaper cited in the report projects that assets under management of tokenised funds could exceed US$600 billion by 2030. For a settlement, custody or fund-administration team, the operational question is no longer whether tokenised assets need on-chain cash to settle against, but which form of that cash, an e-HKD, a tokenised deposit, or a regulated stablecoin, their infrastructure will need to accept.

The one detail that trips product teams is the settlement-cycle ambition. Several pilots tested whether tokenised deposits and an e-HKD could push settlement from T+1 toward same-day or near-instant, T+0, using atomic delivery-versus-payment. The report’s finding is cautionary: achieving T+0 involves far more than tokenising the cash leg, because settlement still spans multiple processes and stakeholders, and a near real-time source of net asset value is one of the gating constraints. Faster settlement is an ecosystem programme, not a token feature.

The common token standards are the artifact to watch

The single most actionable deliverable in the report is the set of common token standards. The e-HKD Industry Forum, established under Project e-HKD+ in December 2024, ran a Programmability Working Group of nine participating firms to make recommendations on shared programmability issues. The Phase 2 Report stated that its detailed findings, including a set of common token standards, would be made available separately by the first half of 2026, and noted that the standards had been tested on various blockchains for technical robustness. The HKMA’s current CBDC page still describes publication of the standards as forthcoming.

These standards are intended to enable cross-institution programmability if an e-HKD is implemented for retail in future, and to support the scaled adoption of programmability in digital money more generally. They should not be conflated with the separate work of the Project Ensemble Architecture Community, which the HKMA established to develop industry standards supporting interoperability among wholesale CBDC, tokenised money and tokenised assets.

One caveat the report makes plain: the e-HKD Sandbox used in the pilots is DLT-based, built on Hyperledger Besu, but the use of DLT is not a prerequisite for an e-HKD, and the sandbox does not necessarily represent the eventual technical architecture. Reading the sandbox stack as a committed design choice would be a mistake.

Where this leaves tokenised deposits and the stablecoin regime

The report places the e-HKD inside a fuller map of digital money rather than treating it in isolation. On the public-money side sit CBDCs; on the private-money side sit commercial bank deposits, electronic money, and regulated stablecoins. Tokenised deposits are the digital representation of traditional bank deposits on DLT networks, and they are the private-money instrument the pilots found most competitive with an e-HKD in retail use.

The stablecoin leg of that map is now regulated. Hong Kong’s Stablecoins Ordinance (Cap. 656) came into effect on 1 August 2025, establishing a licensing regime for issuers of fiat-referenced stablecoins built on the “same activity, same risks, same regulation” principle. The report frames stablecoins, tokenised deposits and an e-HKD as parallel candidate settlement media for tokenised assets, each with different issuers and different risk profiles. For a compliance function, the practical read is that the HKMA is prioritising the e-HKD for financial institutions in wholesale scenarios while continuing preparations for a possible future retail extension; regulated stablecoins and tokenised deposits continue to develop alongside it under their respective frameworks.

What this announcement does not create

This is a policy stance, not a reporting instrument, and the distinction is worth stating flatly because change notes in this space are easy to over-read. The Phase 2 Report does not create a new mandatory return, a new template, a filing deadline, or a supervisory data collection for banks or payment service providers. Nothing in the 28 October announcement obliges an authorized institution to report anything it did not report before.

What it changes is direction and expectation. The obligations that apply to a Hong Kong firm continue to arise from the legal and supervisory instruments governing its activities. The Phase 2 Report does not identify a separate mandatory reporting framework merely because a firm participates in an HKMA tokenisation pilot. Treating a strategy report as a source of reporting duties is the fastest way to build a control that no rule requires. The correct posture is to track the two forward deliverables, engage with Project Ensemble and the Industry Forum where relevant, and keep watch for any consultation or supervisory guidance that follows the H1 2026 groundwork.

How the wholesale pivot compares with other CBDC programmes

Hong Kong’s choice reads differently against the European trajectory, which is useful context for a group operating across both. The European Central Bank completed the digital euro preparation phase in October 2025 and has moved into the next phase of the project; in 2026 it selected payment service providers for a 12-month pilot planned to start in the second half of 2027, a path this desk has covered in its digital euro PSP pilot coverage. The HKMA, facing a mature private retail payment market and a strong tokenised-deposit case, has instead deprioritised the retail instrument and pushed the central bank money into wholesale settlement, closer in spirit to the wholesale tokenisation work Europe runs alongside its retail project.

The lesson the report itself draws is that CBDC design has to answer to local payment needs, and that the motivations cited by jurisdictions issuing a general-purpose CBDC have limited applicability in Hong Kong today. A firm should read the wholesale pivot as the answer Hong Kong’s own conditions produced, specific to its payment market.

Frequently Asked Questions

Does the completion of the e-HKD Pilot Programme mean a retail e-HKD will never launch?

No. The HKMA has kept a retail e-HKD as a future option while prioritising wholesale use. The Phase 2 Report set the first half of 2026 as the target for policy, legal and technical groundwork; subsequent HKMA material continues to describe preparation for possible future retail use as ongoing and subject to international developments, technology and market needs.

Is a Hong Kong bank required to do anything new because of the Phase 2 Report?

The report creates no new reporting obligation, template or deadline. Existing duties continue to come from the relevant instruments, such as the Stablecoins Ordinance for licensed issuers and the banking and stored-value regimes. The report is a policy stance that signals where the HKMA will direct its own development effort.

What is the difference between an e-HKD and a tokenised deposit for settlement purposes?

An e-HKD is central bank money and free of credit risk; a tokenised deposit is the digital representation of a commercial bank deposit and carries the issuing bank’s credit risk. The pilots found the two are perceived similarly by retail users given high trust in Hong Kong’s banks, which is part of why the retail e-HKD case was judged contingent. In wholesale large-value settlement, the e-HKD’s lack of credit risk is a clearer advantage.

When will the common token standards be published, and are they binding?

The Phase 2 Report set the first half of 2026 as the target for separate publication of the e-HKD Industry Forum’s Programmability Working Group findings, including common token standards. The HKMA’s current CBDC page still describes publication as forthcoming. The source describes the standards as supporting cross-institution programmability; it does not establish their legal or supervisory status.

How does Project Ensemble relate to the e-HKD after this decision?

Project Ensemble, launched in March 2024, is the HKMA’s wholesale tokenisation programme. In November 2025 the HKMA launched EnsembleTX, its pilot phase for real-value transactions involving tokenised deposits and digital assets. The Phase 2 Report separately states that further e-HKD studies and pilots may take place both within and outside Project Ensemble.

Does the wholesale focus change how the Stablecoins Ordinance applies to issuers?

No. The Stablecoins Ordinance (Cap. 656) took effect on 1 August 2025 and operates on its own terms for fiat-referenced stablecoin issuers. The Phase 2 Report positions regulated stablecoins, tokenised deposits and an e-HKD as parallel settlement media for tokenised assets; it does not amend or displace the stablecoin licensing regime.

Is distributed ledger technology now mandatory for anything the HKMA has decided?

No. The e-HKD Sandbox used in the pilots was built on Hyperledger Besu, but the report states that DLT is not a prerequisite for an e-HKD and that the sandbox does not necessarily represent the eventual architecture. The technical design of any future e-HKD remains open.

Related Articles

• HKMA Project Ensemble and Tokenised Deposits: How Hong Kong’s wholesale tokenisation vehicle handles interbank settlement of tokenised deposits.
• Hong Kong Stablecoins Ordinance and HKMA Issuer Licences: The licensing regime for fiat-referenced stablecoin issuers that took effect on 1 August 2025.
• MiCAR Token Classification and Reporting Obligations: How the EU sorts asset-referenced and e-money tokens, a useful contrast to Hong Kong’s approach.
• ECB Appia and Pontes Tokenised Settlement: The European wholesale tokenised-settlement track running alongside the digital euro.
• Digital Euro PSP Pilot Open Call: The ECB’s retail-first CBDC path, a direct contrast with the HKMA’s wholesale pivot.

Key Takeaways

• The HKMA completed the e-HKD Pilot Programme with the Phase 2 Report on 28 October 2025 and set wholesale settlement and tokenisation as the immediate e-HKD priority.
• A retail e-HKD remains a future option: the Phase 2 Report set the first half of 2026 as the target for policy, legal and technical groundwork, while subsequent HKMA material says preparation is continuing and any future retail use remains subject to international developments, technology and market needs.
• The Phase 2 Report set the first half of 2026 as the target for publication of the Industry Forum’s common token standards for cross-institution programmability. These are distinct from Project Ensemble’s separate interoperability-standards work.
• Project Ensemble, launched March 2024, is the near-term channel for wholesale e-HKD and tokenised-asset work; further pilots will run within and outside it.
• The report creates no new reporting return, template or filing deadline for banks or PSPs; existing duties still flow from the Stablecoins Ordinance and the banking and stored-value regimes.
• Commercial banks in the pilots slightly preferred tokenised deposits to a retail e-HKD, citing cost of capital, design flexibility and customer stickiness.
• DLT is not a prerequisite for an e-HKD, and the Hyperledger Besu sandbox does not fix the eventual architecture, so infrastructure design remains open.

Sources and References

• Hong Kong Monetary Authority, “HKMA completes e-HKD Pilot Programme and outlines future direction of e-HKD”, press release, 28 October 2025: hkma.gov.hk/eng/news-and-media/press-releases/2025/10/20251028-4
• Hong Kong Monetary Authority, “e-HKD Pilot Programme Phase 2 Report”, October 2025: e-HKD Pilot Programme Phase 2 Report (PDF)
• Hong Kong Monetary Authority, “HKMA announces the new phase of Project Ensemble to support real-value transactions in tokenised deposits and digital assets” (EnsembleTX), press release, 13 November 2025: hkma.gov.hk/eng/news-and-media/press-releases/2025/11/20251113-3
• Hong Kong Monetary Authority, “HKMA establishes the Project Ensemble Architecture Community”, press release, 7 May 2024: hkma.gov.hk/eng/news-and-media/press-releases/2024/05/20240507-4
• Hong Kong Monetary Authority, Central Bank Digital Currency (CBDC) key-function page: hkma.gov.hk CBDC
• Government of the HKSAR, mirror of the 28 October 2025 press release: info.gov.hk P2025102800311
• Stablecoins Ordinance (Cap. 656), effective 1 August 2025, licensing regime for fiat-referenced stablecoin issuers, as referenced in the Phase 2 Report.

What Hong Kong firms should put on the 2026 calendar

The e-HKD Pilot Programme has ended with the HKMA prioritising wholesale use while continuing preparations for a possible future retail extension. The Phase 2 Report set first-half-of-2026 targets for retail groundwork and the Industry Forum’s programmability standards, but those dates are now past and should not be presented as forward milestones. Project Ensemble has meanwhile moved into EnsembleTX, its real-value pilot phase for tokenised deposits and digital assets.

Disclaimer: The information on RegReportingDesk.com is for educational and informational purposes only. It does not constitute legal, regulatory, tax, or compliance advice. Always consult your compliance officer, legal counsel, or the relevant supervisory authority for guidance specific to your institution.