HSBC launched RedCoin on Friday, a Hong Kong dollar stablecoin on its PayMe app, enabling more than 3.3 million users to activate wallets in the coming days for payments to friends or at more than 100,000 merchants. The bank received its issuer license from the Hong Kong Monetary Authority in April under a regulatory regime that took effect in August 2025, beating a field of at least 36 competing companies by September of that year. RedCoin represents the first major bank-issued stablecoin for retail payments in Hong Kong, allowing users to transact with blockchain-based money issued by the same institution that may hold their salary, without opening a crypto exchange.
HSBC Operates RedCoin on Private Ledger with Cash Reserves
RedCoin runs on HSBC's own private ledger rather than a public blockchain like Ethereum. HSBC's reserve tracker showed roughly $10.2 million in RedCoin circulating shortly after launch, backed by $10.4 million held entirely in cash. One RedCoin (ticker RCHKD) equals one Hong Kong dollar. Balances cannot move between PayMe and HSBC's banking app. RedCoin is not a bank deposit, so Hong Kong's Deposit Protection Scheme does not cover it. The first independent attestation of RedCoin's reserves is expected after the fourth quarter of 2026, according to HSBC.
HSBC Plans HK Mobile Banking Integration and Tokenized Fund Access
Later this year, HSBC plans to bring the token to its HK Mobile Banking app. Customers will be able to buy into a tokenized share class of HSBC's Hong Kong dollar money market fund, a low-risk fund that parks cash in short-term debt. Tokenized means ownership is recorded as a digital token on a ledger instead of in a traditional registry. John O'Neill, HSBC's managing director of digital assets and currencies, stated the bank will add more products, including expanding into wholesale corporate and institutional use cases.
Goldman Sachs and Bank of America Announce Joint Dollar Stablecoin
In September, 21 lenders including Goldman Sachs and Bank of America announced plans for a joint dollar stablecoin, targeting a launch in the first half of 2027. Stablecoins have mostly been a crypto-company business until now, with Tether's USDT and Circle's USDC dominating a market worth more than $300 billion, with most of that money on trading platforms rather than retail payment use.
FAQ
What did HSBC launch on Friday?
HSBC launched RedCoin, a Hong Kong dollar stablecoin, on its PayMe app on Friday. More than 3.3 million PayMe users can activate wallets in the coming days to send RedCoin to friends or pay at more than 100,000 merchants.
How is RedCoin backed and where does it operate?
RedCoin operates on HSBC's private ledger with roughly $10.2 million circulating backed by $10.4 million held entirely in cash, according to HSBC's reserve tracker shortly after launch. One RedCoin equals one Hong Kong dollar. The first independent reserve attestation is expected after the fourth quarter of 2026.
