Hong Kong is launching a new batch of government-backed digital green bonds, its third digital bond sale since 2023, as part of a strategy to become a global hub for tokenized assets.

The issue is part of a regional push among Hong Kong, Singapore, and Dubai to lead Asia’s blockchain-enabled finance hub, building a programmable financial infrastructure that links debt instruments, tokenized assets, and digital investments under regulated rules.

The bonds carry a green label, with proceeds earmarked for environmental or climate projects, aligning with Hong Kong’s bid to attract capital through its blockchain initiative amid regional competition.

Market reception is positive, with S&P assigning an AA+ rating and noting a fail-safe mechanism that can shift the bonds back to traditional issuance if needed.

The offering is rated AA+ by S&P and includes a mechanism to migrate to conventional systems if blockchain functionality falters.

The report cites Bloomberg via Coindesk, indicating coverage from major financial outlets.

Pricing for the new issue could be finalized on the day of reporting, with the deal denominated in multiple currencies to attract a diverse investor base.

The bonds will be digitally native, created and settled entirely on blockchain platforms, with HSBC providing the infrastructure for this issue, and denominated in US dollars, euros, offshore yuan, and Hong Kong dollars.

Settlement will occur on blockchain platforms, backed by HSBC’s infrastructure.

As a multi-currency, natively digital instrument, the bonds are designed to be fully blockchain-created and settled.

The broader aim is to demonstrate that sovereign debt can be issued, settled, and audited entirely on blockchain, potentially making Asia the first region where sovereign and corporate digital debt share infrastructure and liquidity.

Recent tokenized bond issuers in Hong Kong include state-backed Shenzhen Futian Investment Holdings and Shandong Hi-Speed Holdings Group, signaling growing participation by major players.

Since 2023, Hong Kong has issued at least six tokenized bonds or sovereign/debt instruments, raising roughly $1 billion and attracting banks, insurers, and corporates to blockchain-based debt.

This development follows earlier blockchain-based bond issuances by Hong Kong and underscores ongoing use of digital securities in government financing.