Bank of China International (BOCI) has made history as the first Chinese financial institution to issue tokenized securities in Hong Kong. On June 9, 2023, BOCI successfully launched a fully digital structured note worth RMB 200 million (approximately $28 million) in collaboration with Swiss banking giant UBS. This groundbreaking transaction marks a significant milestone in Asia-Pacific’s digital asset landscape.
Key Highlights of the Tokenized Note Issuance
Pioneering Partnership:
- UBS initiated and distributed the product to its Asia-Pacific clients
- First regulated securities tokenization under Hong Kong/Swiss legal frameworks
- Executed on the Ethereum mainnet as a public blockchain case study
Technological Innovation:
- Builds upon UBS’s December 2022 issuance of $50M tokenized fixed-rate notes
- Achieves compliance breakthroughs in blockchain-based securities
- Demonstrates institutional adoption of public blockchain infrastructure
Market Leadership:
- BOCI becomes China’s first offshore structured note issuer
- Maintains position as volume leader in Chinese structured products
- Expands digital asset offerings for Asia-Pacific investors
Executive Insights
Wang Ying, Deputy CEO of BOCI:
"We’re proud to maintain leadership in fintech and digital finance. Our partnership with UBS enables blockchain-based structured products that simplify digital asset markets. Hong Kong’s evolving digital economy inspires us to drive financial innovation."
Aurelian Troendle, UBS Global MTN Trading Head:
"Bringing structured products to public blockchain networks creates efficiency gains that ultimately benefit investors. We’re expanding tokenization services to meet growing client demand for regulated digital assets."
Tokenization Advancements in Banking
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UBS continues expanding its UBS Tokenize platform with services covering:
- Structured products
- Fixed income instruments
- Repo financing solutions
The bank has positioned itself as a leader in:
- Institutional-grade tokenization
- Regulatory-compliant digital assets
- Cross-border blockchain implementations
FAQ: Understanding Tokenized Securities
Q: What makes tokenized notes different from traditional securities?
A: Tokenization represents ownership via blockchain tokens, enabling faster settlement, fractional ownership, and programmable features while maintaining regulatory compliance.
Q: Why choose public blockchains like Ethereum?
A: Public networks offer transparency, interoperability, and network effects while institutional solutions address privacy and compliance requirements.
Q: How does this benefit Hong Kong’s financial market?
A: Positions Hong Kong as a digital asset hub with:
- Innovative financial products
- Attractive regulatory environment
- Cross-border collaboration opportunities
Q: What’s next for institutional tokenization?
A: Expect expansion into:
- Secondary market liquidity
- Automated compliance features
- Integration with traditional systems
Risk Considerations
While blockchain technology offers efficiencies, investors should note:
- Cryptocurrency investments carry high volatility risk
- Regulatory frameworks continue evolving
- Technological risks require careful assessment
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This landmark transaction demonstrates growing institutional confidence in blockchain applications, with BOCI and UBS paving the way for Asia-Pacific’s regulated digital asset ecosystem.