Highlights
- Complete a proof-of-concept with the HKMA’s e-HKD Pilot Programme
- Create an end-to-end solution for programmable payment and investment
- Execute atomic, delivery-vs-payment settlement of hypothetical e-HKD vs. tokenized fund
- Enable financial inclusion and interest income generation on small balance for retail
- Reduce costs and preserves privacyon investor onboarding with verifiable credential
(Hong Kong, 30th October 2023) ARTA-Emali HK Limited (“ARTA-Emali”), as one of the participating entities of the Hong Kong Monetary Authority’s e-HKD Pilot Programme, completed a proof-of-concept (“PoC”) on executing programmable payment for atomic settlement of tokenized fund via the smart contract of a hypothetical e-HKD.
ARTA-Emali is a subsidiary of Arta TechFin Corporation Limited (“Arta TechFin”, HKSE: 0279). Arta TechFin and Emali Limited jointly develop Web3 digital infrastructure and application via research and implementation of blockchain and cryptography technology.
e-HKD Smart Contract-based Platform
Under the PoC, investors can enjoy an end-to-end solution to connect payment and investment via smart contracts. Investors can execute fund order instructions with a specific investment period and target return via the smart contract of a hypothetical e-HKD. The smart contract automatically executes near-instant delivery vs. payment for both fund subscription and redemption on pre-defined dates. Fund managers can issue fund tokens to the investors efficiently, whereas trade recap and live net asset value are available throughout the asset holding period. (Chart 1)
Financial institutions (“FIs”) can offer suitable fund products with market-competitive yields to retail investors with small balances and/or for a short period of investment period. The smart contract with investors’ verifiable credential (“VC”) provides an operational foundation for a straight-through integration across upstream and downstream financial intermediaries (e.g., placing agents, fund managers, fund administrator). This distributed-ledger-technology solution makes fund investment process more time-efficient and cost-effective, enabling financial inclusion, reducing counterparty risks, and unlocking values in liquid balance.
"Arta TechFin is transcending the limitations of traditional trading and settlement processes. Our innovative product captures the interplay between CBDCs/Stablecoins and tokenized securities via smart contracts and responds to customers’ voices for regulated web3 solutions. We look forward to further collaboration with the HKMA and other industry stakeholders to redefine the future of finance.” said Eddie Lau, Co-Chief Executive Officer of Arta TechFin.
ARTA-Emali has been selected to participate in the HKMA’s e-HKD Pilot Programme in May 2023, whereour chosen use case is to develop Programmable Payment – Investment. Arta TechFin won “Best Technology Award” in Central Bank Digital Currency (CBDC) track of Global Fast Track 2022 co-hosted by InvestHK and HKMA.
Expanding Service Scope to Payment
Arta TechFin is expanding its service and product scope to DLT-based programable payment and investment. Recent innovation initiatives in brokerage and asset management products include tokenized investments in government bonds and fund shares.
In addition, Arta TechFin is developing VC-based identities and onboarding. VC implements best-practice regulatory standards in know-your-client (KYC), Anti-money-laundering (AML) and suitability process. Cryptographic challenge and proofs as well as Zero-knowledge proof techniques are applied to preserve privacy and enforce governance. Both investors and FIs will benefit from enhanced compliance control and reduced repetitive entries in onboarding.
Operational Flow
Arta TechFin has performed user acceptance testing on the e-HKD solution with 10+ global FIs and 100+ potential retail clients.
For further details, please see our factsheet here. https://www.artatechfin.com/media-centre/press-post/programmable-payments-atomic-settlement-of-e-HKD-and-tokenized-fund-shares
About Arta TechFin Corporation Limited
Arta TechFin is a hybrid financial (HyFi) platform bridging traditional finance with blockchain-based financial system via technology innovations.Its regulated one-stop solution enables corporates, financial institutions, and family offices to access traditional assets and digital assets.
ARTA, through its various subsidiaries, are licensed under Hong Kong Securities and Futures Commission. Other licenses include Hong Kong Stock Exchange participant, insurance brokerage license, trustee license and money lending license in Hong Kong as well as Eurex participant in Germany.
About Emali Limited
Emali is an enterprise technology company specializing in the development of Web3 solutions for enterprises using its proprietary Trust Solutions technology stack. The company has developed and deployed multiple distributed systems for government agencies, financial institutions, and large corporations.
Media Enquiry:
Ayishah Ma
ir@artatechfin.com
(852) 3513 8010
This press release is prepared in English and is translated into traditional and simplified Chinese. In the event of inconsistency between the English version and the translated versions, the English version prevails.