The Hong Kong Center of the Innovation Hub of the Bank for International Settlements (BIS) and the Hong Kong Monetary Authority (HKMA) announced a joint project to build a prototype digital infrastructure that can enable green investments and help issuers and governments to meet environmental and sustainability goals. These two entities have joined forces with the technology industry via Project Genesis, to build this prototype digital infrastructure. The Project Genesis will explore the tokenization of green bonds to enable investments in small denominations, combined with real-time tracking of environmental outputs. The results of the tests and prototypes will be published in the fourth quarter of 2021.
Project Genesis is the first green finance project of the BIS Innovation Hub. Through this project, the Hub seeks to show "the green art of the possible" by combining blockchain, smart contracts, internet-of-things, and digital assets. The prototypes will allow policy makers and stakeholders to explore innovative approaches to green bond distribution and transparency. After starting with design thinking workshops, the development teams are now working in iterative sprints to build the prototypes while collaborating with key stakeholders in the Hong Kong financial ecosystem. Genesis will be developed with six partner companies:
- Digital Asset (Switzerland) and GFT Technologies Hong Kong will deploy multiple permissioned blockchains.
- The Liberty Consortium, comprising SC Ventures, Standard Chartered Bank, and Shareable Asset, will be leverage a public, permission-less blockchain infrastructure.
- Allinfra, a Hong Kong Special Administrative Region start-up, will provide technology verified data that can track in real-time the positive environmental impact of projects.
Genesis is guided by a multi-disciplinary panel of experts in environmental, social and governance (ESG), green finance, bond markets, law, and regulation; this is in line with the insight derived from the BIS Green Swan research report (published in January 2020) that climate change involves complex collective action problems that require increased coordination among governments, private sector, civil society, and international community.
Keywords: International, Asia Pacific, Hong Kong, Banking, Green Bonds, ESG, Sustainable Finance, Project Genesis, Blockchain, Smart Contracts, Regtech, BIS Innovation Hub, Suptech, BIS, HKMA
Previous ArticleMAS and U.S. Treasury Announce MoU on Cybersecurity Cooperation
In a letter addressed to the industry, the Australian Prudential Regulation Authority (APRA) set out an updated schedule of policy priorities for the banking, insurance, and superannuation industries.
The European Commission (EC) adopted a comprehensive review package of Solvency II rules in the European Union.
The Office of the Comptroller of the Currency (OCC) issued Versions 1.0 of the "Earnings" and "Regulatory Reporting" booklets of the Comptroller's Handbook.
The European Central Bank (ECB) published results of its economy-wide climate stress test, which aimed to assess the resilience of non-financial corporates and euro area banks to climate risks.
The European Banking Authority (EBA) published a report on the use of digital platforms in the banking and payments sector in European Union.
The Hong Kong Monetary Authority (HKMA) published updates on the policy measures that were announced in context of the ongoing pandemic.
The International Swaps and Derivatives Association (ISDA), along with several other associations, submitted a joint response to the Basel Committee on Banking Supervision (BCBS) consultation on preliminary proposals for the prudential treatment of cryptoasset exposures.
BIS published the September issue of the Quarterly Review, which contains special features that analyze the rapid rise in equity funding for financial technology firms, the effectiveness of policy measures in response to pandemic, and the evolution of international banking.
The Basel Committee for Banking Supervision (BCBS) met in September 2021 and reviewed climate-related financial risks, discussed impact of digitalization, and welcomed efforts by the International Financial Reporting Standards (IFRS) Foundation to develop a common set of sustainability reporting standards
The Office of the Comptroller of the Currency (OCC) issued a Cease and Desist Order against MUFG Union Bank for deficiencies in technology and operational risk governance.