Fubon Bank, the Hong Kong subsidiary of Taiwan’s Fubon Financial Holding Co., has reportedly announced its intention to launch a pilot program for real estate tokenization. The program is expected to begin in the third quarter of 2023 and will utilize Ripple’s Central Bank Digital Currency (CBDC) platform.
According to a report published earlier today by Lele Jima for The Crypto Basic, the bank’s executive president and chief strategy officer, Xu Luosheng, shared the details of the initiative. The program’s first phase will see Fubon Bank issuing loans in digital Hong Kong dollars. The bank will convert the traditional Hong Kong dollar into a digital version at a 1-to-1 exchange rate for testing purposes. These digital dollars, or e-KHD, will then be issued to customers as loans. Customers will be able to monitor their real-time loan-to-value ratio (LTV) via their e-KHD wallets.
The program’s second phase will allow customers to use their digital Hong Kong dollars to invest in real estate. Luosheng also mentioned the possibility of partnering with real estate companies to accept e-KHD as a payment method, further promoting the use of the digital currency.
As Jima’s report pointed out, the pilot program does not involve the actual issuance of digital Hong Kong dollars. Instead, it’s part of Hong Kong’s new e-HKD pilot program. Ripple and Fubon Bank joined forces in May as part of the Hong Kong Monetary Authority’s (HKMA) e-HKD pilot program. The two entities will work together on real estate tokenization using e-KHD.
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Ross Edwards, Ripple’s CBDC Director, also commented on the initiative. He explained that the Ripple CBDC platform would integrate a hypothetical e-KHD, tokenized real estate, and financial lending agreements, using the XRP Ledger (XRPL).
Ripple has previously expressed its intention to revolutionize the real estate industry through tokenization.
With the tokenized asset industry projected to reach $16 trillion by 2030, Ripple is positioning itself to take full advantage of this business opportunity. Last year, the company partnered with Portugal-based real estate company ProprHome to transform the country’s real estate sector.
Featured Image Credit: Photo by nextvoyage via Pixabay
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- Source: https://www.cryptoglobe.com/latest/2023/07/ripples-cbdc-platform-powers-fubon-banks-real-estate-tokenization-pilot/
