Mastercard, Standard Chartered, Mox and Libeara successfully complete a proof-of-concept pilot on tokenised deposits and tokenised carbon credits through regulatory sandbox

Standard Chartered Bank (Hong Kong) Limited (“SCBHK”) has partnered with Mox Bank Limited (“Mox”), Mastercard and Libeara on a proof-of-concept (“POC”) pilot exploring the operational and risk management benefits of tokenised deposits to support the settlement of tokenised assets. Completed under the Hong Kong Monetary Authority (“HKMA”)’s Fintech Supervisory Sandbox, the POC is the latest milestone in driving fintech innovation and developing the tokenisation market in Hong Kong.

As the first live test of the Mastercard Multi-Token Network (“MTN”), the POC used the following test scenario to explore how this could work in the context of carbon credits:

1. A Mox client wants to buy a carbon credit to offset his/her personal carbon usage and deposits the funds for this in his/her Mox bank account.

2. Mox requests SCBHK tokenise the desired carbon credit using Libeara, a tokenisation platform incubated by TC Ventures.¹

3. Through the Mastercard MTN, the client’s deposit is also tokenised and an atomic swap² is initiated between the two tokenised instruments.  

4. The result is a transparent, real-time transaction between SCBHK and Mox, with the end client receiving access to a tokenised version of their carbon credit. This can be held in a digital wallet or in this scenario, used to offset his/her carbon footprint.

Mary Huen, Chief Executive Officer, Hong Kong, Standard Chartered, said, “The tokenisation of real-world assets and the potential use of different forms of tokenised currency is integral to the future of the financial industry. SCBHK is keen to stay at the forefront of tokenisation and drive fintech development in Hong Kong. Under the guidance of the HKMA, we are proud to pioneer this project with our virtual bank Mox, incubated venture Libeara and longtime partner Mastercard, with the objective of catalyzing the adoption of tokenisation in financial assets. This POC developed around tokenised carbon credits and tokenised deposits is a testament to how SCBHK supports sustainable finance innovation in Hong Kong’s digital economy.”

Helena Chen, managing director, Hong Kong & Macau, Mastercard said: “To unlock the full potential of blockchain technology, continuous collaboration, testing, exploration and development of innovative use cases are needed to bring real value to businesses and interoperability across the industry. Using the Mastercard MTN, Mastercard is energised to partner with industry-leading players like SCBHK, Mox and Libeara to develop real-world applications that reshape how consumers and businesses connect, interact and transact. As the Hong Kong Monetary Authority (HKMA) further develops Hong Kong as a leading digital assets hub, Mastercard is fully committed to supporting its efforts to drive fintech innovation and the advancement of the tokenisation market in Hong Kong.”

Utilising Standard Chartered’s extensive global network and the strong collaboration between its various business arms, this POC demonstrates the Bank’s strategic approach to pool the collective expertise from its partners and drive innovative digital finance solutions. SCBHK supports the development of digital assets in Hong Kong through a variety of key projects, including Project mBridge, Project Ensemble and the HKMA’s e-HKD Pilot Programme. Together with its partners, SCBHK continues to explore the possibilities of digital asset-related technologies and contribute to Hong Kong’s development as a digital asset hub. Most recently, Libeara has extended its footprint to Hong Kong to better support tokenisation projects in the region.   

Mastercard has a wider commitment to helping people, businesses and governments better understand and trust how blockchain technology can be used to address pain points and build more efficient systems. This includes working with a range of partners in Hong Kong and around the world to deploy innovative technologies to benefit businesses that are looking to exchange value safely and securely.