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ZEC $1,155 Stablecoins · Explained
HSBC launches Hong Kong dollar stablecoin RedCoin on PayMe
The bank is phasing RedCoin wallets to more than 3.3 million PayMe users for transfers and merchant payments, with tokenized fund access planned.
Key takeaways
- Phased PayMe rollout. More than 3.3 million PayMe users can activate RedCoin wallets over the coming days for peer-to-peer transfers and payments at over 100,000 merchants.
- One-for-one design. RedCoin (RCHKD) is designed to be redeemable one-for-one for Hong Kong dollars and runs on HSBC's own ledger, not a public blockchain.
- Tokenized funds next. HSBC plans to add RedCoin to its Hong Kong mobile banking app and offer tokenized money market fund subscriptions from HK$100 later this year.
What happened
HSBC began a phased launch of RedCoin on Oct. 23, letting PayMe users in Hong Kong activate a stablecoin wallet inside the app. The bank said more than 3.3 million PayMe users will be able to turn on the wallet over the coming days, then send the token to friends and family or pay at more than 100,000 merchants that accept PayMe. Customers do not need another bank account or a minimum balance, according to Crypto.news and CoinGape.
RedCoin (RCHKD) is designed to be redeemable one-for-one for Hong Kong dollars, subject to applicable terms. It runs on HSBC's own private ledger rather than a public blockchain, and customers reach it through HSBC-approved applications. HSBC Digital Assets Custody provides safekeeping. The bank says RedCoin wallets are not deposit accounts, are not covered by Hong Kong's Deposit Protection Scheme, and cannot move directly between PayMe and HSBC's future banking-app wallet, according to published FAQs cited by Crypto.news.
Unchained reported that HSBC ran staff pilots with close to 100 employees covering minting, wallet activation and live transfers before launch. HSBC plans to bring the wallet to its HSBC HK Mobile Banking App later this year, where customers can subscribe to tokenized investment products, starting with a yet-to-launch share class of its Hong Kong dollar money market fund. John O'Neill, HSBC's managing director of digital assets and currencies, said the launch was only the beginning and that the bank would soon add more products, including wholesale corporate and institutional use cases.
Why it matters
The rollout puts a bank-issued stablecoin inside a consumer payment app that millions of people already use, instead of requiring customers to open a crypto exchange account. CoinGape described it as the first retail rollout of a licensed bank-issued stablecoin under Hong Kong's Stablecoins Ordinance.
Most stablecoin activity has been concentrated on trading platforms and in tokens from crypto-native issuers. HSBC's move tests whether a licensed bank can use a stablecoin for everyday payments and, later, tokenized investment subscriptions. The design is controlled: RedCoin runs on HSBC's ledger, uses HSBC-approved apps and is not a deposit. That limits open public-chain use but may fit more easily into bank compliance and custody arrangements.
What the data shows
HSBC's Oct. 23 disclosure listed HK$80.58 million in circulating RedCoin against HK$81.58 million in reserve assets, Crypto.news reported, leaving reserves about HK$1 million above the outstanding token value at the reporting date. The bank said the reserves were held in cash. Decrypt, citing HSBC's reserve tracker, reported roughly $10.2 million in RedCoin circulating shortly after launch, backed by $10.4 million in cash. HSBC says the first independent attestation of reserves is expected after the fourth quarter of 2026. In a June online survey of 1,060 HSBC customers aged 18 to 64, 53% said HKD stablecoins could make Hong Kong's economy more competitive, Unchained reported.
Background
The Hong Kong Monetary Authority licensed HSBC's banking arm, The Hongkong and Shanghai Banking Corporation, as a stablecoin issuer on April 10, alongside Anchorpoint Financial, a Standard Chartered-backed joint venture with Animoca Brands and HKT. HSBC holds license FRS02 and Anchorpoint FRS01, Crypto.news reported. The licenses came under the Stablecoins Ordinance, effective Aug. 1, 2025, which sets reserve, redemption and governance requirements.
Anchorpoint introduced its HKDAP stablecoin through HashKey Exchange in August, initially for eligible institutions and professional investors. HSBC has also built tokenized products: its Orion platform has handled more than $8.3 billion in digitally native bond issuance worldwide since 2023, and its retail Gold Token had logged 390,000 trades worth $2.5 billion by the end of August, Unchained reported. In September, 21 lenders including Goldman Sachs and Bank of America announced plans for a joint dollar stablecoin targeting the first half of 2027, Decrypt reported.
What is still unclear
HSBC has not disclosed how many PayMe users have activated RedCoin wallets, how many transactions have been completed, or what share of eligible users have adopted the feature, Crypto.news reported. Exact launch dates for tokenized gold and third-party funds have not been announced, and not every participating fund manager has been identified. Merchant settlement will initially follow existing Hong Kong dollar schedules, with faster timelines expected in later phases, CoinGape reported.
What to watch
HSBC plans to integrate RedCoin into its Hong Kong mobile banking app before the end of 2026 and offer tokenized money market fund subscriptions from HK$100, with tokenized gold and third-party funds later. It also intends to expand into wholesale corporate and institutional use cases. The first independent reserve attestation is expected after the fourth quarter of 2026. Anchorpoint is already serving institutional customers, and the 21-bank dollar stablecoin project is targeting the first half of 2027.
Questions readers ask
What is RedCoin?
RedCoin (RCHKD) is a Hong Kong dollar stablecoin issued by HSBC. It is designed to be redeemable one-for-one for Hong Kong dollars, subject to applicable terms, and runs on HSBC's own ledger rather than a public blockchain.
Who can use RedCoin?
HSBC is phasing access to more than 3.3 million PayMe users in Hong Kong. Customers update the PayMe app and activate a wallet; no additional bank account or minimum balance is required. HSBC plans to add the wallet to its Hong Kong mobile banking app later this year.
Is RedCoin protected by Hong Kong's Deposit Protection Scheme?
No. HSBC says RedCoin wallets are not deposit accounts and are not covered by the Deposit Protection Scheme.
Sources · 11 publishers
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HSBC rolls out its first HKD stablecoin RedCoin to retail users -
HSBC Rolls Out HKD RedCoin Stablecoin to 3.3M PayMe Users Starting Today -
HSBC RedCoin Stablecoin Targets 3.3M PayMe Users in Hong Kong -
HSBC Launches RedCoin Stablecoin for 3.3 Million PayMe Users in Hong Kong
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HSBC launches Hong Kong dollar stablecoin for retail payments
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HSBC launches RedCoin stablecoin, plans HK$100 tokenized fund investments -
HSBC Launches RedCoin Stablecoin and Plans to Let Customers Buy Tokenized Funds With It -
HSBC Brings Hong Kong Dollar Stablecoin To PayMe As Retail Rollout Begins -
HSBC Launches First Stablecoin, Bringing Hong Kong Dollar Payments to 3.3M Users -
3.3M users gain HSBC RedCoin, yet 1 strict rule blocks them -
Hong Kong’s Biggest Bank Puts a Stablecoin in 3 Million Wallets
Update log
- HSBC has begun a phased rollout of RedCoin (RCHKD), a Hong Kong dollar stablecoin, to PayMe users. The token is designed to be redeemable one-for-one for Hong Kong dollars and can be used for peer-to-peer transfers and payments at more than 100,000 merchants. HSBC plans to add the wallet to its Hong Kong mobile banking app and support tokenized fund subscriptions later this year.
- First published.
