Standard Chartered Bank (SCBHK) has completed testing the tokenization of bank deposits and carbon credits, opening up the potential for tokenized asset payments in the future.

According to a press release dated May 14, SCBHK has partnered with Mox Bank (Mox), Mastercard and Libeara to carry out a pilot project (POC) in the Hong Kong Monetary Authority's Fintech Test Zone ( HKMA).

The project focuses on exploring the operational and risk management benefits of tokenized deposits to support settlement of tokenized assets. This is the first time Mastercard's Multi-Token Network (MTN) has been tested live.

As part of the POC, a Mox customer wants to purchase carbon credits to offset personal carbon emissions. The customer deposited money into a Mox bank account and requested SCBHK to tokenize carbon credits through Libeara, a tokenization platform built by SC Ventures.

Next, the customer's deposit is tokenized through Mastercard's MTN, and a simultaneous swap is performed between the two tokens. The result will be an instant, transparent transaction between SCBHK and Mox, allowing customers to receive tokenized carbon credits.

Customers can keep this carbon credit in a digital wallet or use it to offset their carbon emissions.

“The tokenization of real-world assets and the ability to use different forms of tokenized currencies is essential for the future of the financial industry,” said Ms. Mary Huen, CEO of SCBHK.

Ms. Helena Chen, Managing Director of Mastercard in Hong Kong and Macau commented: “To unlock the full potential of blockchain technology, it requires collaboration, experimentation, discovery and continuous development of use cases. Using innovation to deliver real business value and interoperability across the industry.”

This POC project demonstrates SCBHK's strategic approach in pooling expertise from partners and promoting innovative digital financial solutions. SCBHK is also supporting the development of digital assets in Hong Kong through many other key projects, including Project mBridge, Project Ensemble and the HKMA eHKD Pilot Program.