HSBC unveils RedCoin as name of its Hong Kong stablecoin for 3.3 million PayMe users

HSBC on Wednesday named its stablecoin offering HSBC RedCoin, paving the way for Hong Kong’s biggest lender to make the coin available to the more than 3.3 million users of its PayMe app for money transfers, shopping and dining.

When launched before the end of the year, the stablecoin would be offered only through PayMe and HSBC’s Hong Kong mobile banking app, HSBC said.

The bank said it was optimistic about retail usage of HSBC RedCoin, as 74 per cent of respondents to a survey of more than 1,000 customers recognised at least one use case for stablecoins.

The most recognised case, chosen by 57 per cent of respondents, was stablecoins being used for digital asset trading and tokenised investments, the survey showed. Person-to-person money transfers ranked second at 53 per cent, while cross-border remittances and merchant payments each stood at 52 per cent.

The survey also showed that 60 per cent of customers could correctly define a stablecoin as a fiat-backed digital asset.

However, there were also misunderstandings, as 26 per cent assumed stablecoins were government-issued. In fact, they are issued by licensed issuers authorised by the Hong Kong Monetary Authority, which in April issued licences to a Standard Chartered-led consortium and HSBC.

About 10 per cent of consumers said stablecoins would pay interest, but that is not allowed in Hong Kong’s regulatory framework, HSBC said.

“This survey confirms the strong interest among Hongkongers in embracing digital assets,” said Maggie Ng, CEO of HSBC Hong Kong. “HSBC RedCoin isn’t a leap into the unknown, but is a natural next step.”

She added that incorporating the bank’s corporate colour into the name reflected its heritage. HSBC, which has operated in Hong Kong since 1865, has 7 million customers in the city and is the largest of the three note-issuing banks.

“Launching our coin is just the beginning,” Ng said. “Our goal is to support Hong Kong’s financial innovation, underpinned by the security, trust and simplicity that define HSBC.”

HSBC will roll out the stablecoin in phases, starting with everyday use cases such as person-to-person and person-to-merchant payments. The bank earlier said the stablecoin would be accessible through its mobile payment app, PayMe.

In the second stage, the bank will expand the stablecoin’s use into wholesale and corporate banking applications.

The lender did not give a timeline for these phases but said it would launch a comprehensive education series, with a focus on scam prevention and how to redeem the stablecoin.