HSBC launched RedCoin, a Hong Kong dollar stablecoin, on its PayMe app on Friday, enabling more than 3.3 million users to activate digital wallets in the coming days. The bank received its stablecoin issuer license from the Hong Kong Monetary Authority in April under a regulatory framework that took effect in August 2025. Users can send RedCoin to contacts or pay at more than 100,000 PayMe merchants using the blockchain-based token pegged one-to-one with the Hong Kong dollar.
HSBC RedCoin Operates on Private Ledger with Cash Reserves
RedCoin (ticker RCHKD) runs on HSBC's private ledger rather than a public blockchain like Ethereum. The bank's reserve tracker showed roughly $10.2 million in RedCoin circulating shortly after launch, backed by $10.4 million held entirely in cash. Balances cannot move between PayMe and HSBC's banking app. RedCoin is not classified as a bank deposit, so Hong Kong's Deposit Protection Scheme does not cover it.
HKMA Licensed HSBC Under 2025 Stablecoin Framework
HSBC obtained its issuer license from the Hong Kong Monetary Authority in April, under a regime that took effect in August 2025. The bank competed against at least 36 companies by September of that year. John O'Neill, HSBC's managing director of digital assets and currencies, stated that the bank will soon add more products, including expanding into wholesale corporate and institutional use cases.
HSBC Plans Mobile Banking Integration Later This Year
HSBC plans to bring RedCoin to its HK Mobile Banking app later this year. Customers will be able to buy into a tokenized share class of the bank's Hong Kong dollar money market fund, a low-risk fund that parks cash in short-term debt. Tokenized ownership means the asset is recorded as a digital token on a ledger instead of in a traditional registry. The first independent attestation of RedCoin's reserves is expected after the fourth quarter of 2026.
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. Tether's USDT and Circle's USDC dominate the stablecoin market worth more than $300 billion, with most of that money on trading platforms.
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 tokens to friends or pay at more than 100,000 merchants.
How much RedCoin is backed by cash reserves?
HSBC's reserve tracker showed roughly $10.2 million in RedCoin circulating shortly after launch, backed by $10.4 million held entirely in cash. The first independent attestation of reserves is expected after the fourth quarter of 2026.
