The Hong Kong Gold Exchange and China CITIC Bank (International) announced the successful completion of a tokenized deposit gold pilot test under the Hong Kong Monetary Authority's Ensemble project, officially bringing tokenized deposits into the gold market and achieving round-the-clock delivery-versus-payment, with a target for formal launch in 2027.
As the sole settlement bank of the Hong Kong Gold Exchange, CNCB (International) successfully completed tests including cross-bank settlement, aiming for formal commercial launch next year. At that point, traditional deposits and tokenized deposits will operate in parallel, breaking traditional trading limitations and fully supporting 7x24 round-the-clock and real-time settlement for gold transactions, significantly improving settlement efficiency and reducing risk.
The Hong Kong Gold Exchange stated that this is an important step in the exchange's settlement operations, helping to consolidate market confidence and enhance Hong Kong's influence in gold pricing. During the testing period, a total of four member banks participated. The current test settlement speed requires only T+5 minutes, with the future goal of achieving T+0 real-time trading. The shortened settlement time is expected to drive market trading volume and liquidity up by two to three times, and could help members with refining backgrounds increase their trading volume by up to ten times, while also addressing the pain points of cumbersome settlement and high financing costs for non-standardized gold products.
Hong Kong Gold Exchange Chairman Haywood Cheung said that with gold prices currently hitting a historic high of US$4,000 per ounce, gold trading, transshipment, and refining are all capital-intensive businesses with extremely high demands for capital flow. The more robust and diversified the settlement, the more vibrant the market.
CNCB (International) Personal and Business Banking Director Yuen Miu-ling pointed out that with the introduction of smart contracts, transactions can be completed automatically once conditions are met, breaking geographical restrictions and allowing investors worldwide to participate. This successful test marks the transition of tokenization technology from concept to practice and achieves interbank settlement connectivity.
This move is also an important practice by CNCB (International) in responding to the government's first five-year plan for developing bulk commodities and gold trading strategy through fintech innovation. In the future, it will continue to work with the HKMA and the exchange to jointly promote a new chapter in Hong Kong's digital finance.
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