The Kingdom of Saudi Arabia and Hong Kong are set to bolster their financial collaboration, focusing on tokenization and payments infrastructure agreements.
A bilateral meeting between the Saudi Central Bank (SAMA) and the Hong Kong Monetary Authority (HKMA) was held on July 26, aiming to enhance the integration of financial services between the two nations. Aspects such as financial infrastructure development, open market operations, market connectivity, and sustainable development were discussed. A memorandum of understanding (MoU) was signed by the central banks to foster joint discussions on financial innovation.
The authorities of Hong Kong and Saudi Arabia took this opportunity to share their expertise in areas like tokenization, payment infrastructure, and supervision technologies, according to a joint announcement. Eddie Yue, HKMA’s chief executive, said, “There is a lot of room for cooperation between the Kingdom of Saudi Arabia and Hong Kong in the fields of economy and trade, sustainable development, finance, and fintech.”
SAMA governor, Ayman Alsayari, also noted that the MoU will not only foster the ongoing development of the relationship between Hong Kong and Saudi Arabia, but also aid them in future endeavors.
The announcement did not explicitly mention any collaborative efforts related to cryptocurrencies such as Bitcoin, despite the HKMA recently authorizing retail investors to trade crypto. Conversely, the Saudi Arabian government has remained largely silent on any plans to foster crypto, only issuing a warning in 2019 stating that Bitcoin is “not recognized by legal entities” in the country.
Hong Kong is already an active participant in several cross-jurisdictional tokenization initiatives. Notably, in mid-June, the Bank of China’s investment bank subsidiary BOCI issued a $28 million tokenized security in Hong Kong, which was minted on the Ethereum blockchain. The project used Goldman Sachs’ tokenization protocol GS DAP and cash tokens symbolizing claims on the Hong Kong dollar.
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