HSBC launches Hong Kong dollar stablecoin on PayMe app

HSBC has begun rolling out its first stablecoin, a Hong Kong dollar token called RedCoin, onto its PayMe payment app, the bank said. The token, which carries the ticker RCHKD, will let customers send money to friends and family and pay at more than 100,000 merchants. PayMe has more than 3.3 million users, who will be able to activate a stablecoin wallet in the app over the coming days.

The move gives HSBC a route to bring stablecoin payments into an app customers already use, rather than requiring a separate wallet or exchange account. HSBC has said RedCoin will be fully backed by high-quality liquid assets held in separate accounts.

The rollout follows the Hong Kong Monetary Authority's decision to grant its first stablecoin issuer licences in April to HSBC and Anchorpoint Financial, a Standard Chartered-led venture. Anchorpoint began a limited rollout of its HKDAP token in August, focused on institutional payments and settlement.

Vincent Chok, chief executive of FDUSD issuer First Digital, said in emailed comments to CoinDesk that integrating stablecoins into platforms users already rely on removes the need for a separate wallet or exchange account. He added that everyday exposure would over time build familiarity and confidence in stablecoins across the wider market.

HSBC plans to add a RedCoin wallet to its Hong Kong mobile banking app later this year and to let customers use the token to subscribe to tokenised investment products, including a new share class of its existing Hong Kong dollar money market fund. John O'Neill, HSBC's managing director for digital assets and currencies, said the bank would soon add more products, including expanding into wholesale corporate and institutional use cases.