Hong Kong-based Fubon Bank has revealed plans to launch the pilot real estate tokenization program on Ripple’s CBDC platform in Q3 2023.
Fubon Bank, the Hong Kong arm of Taiwan’s Fubon Financial Holding Co., has confirmed plans to launch the pilot real estate tokenization program this year.
According to a recent announcement by local media, Fubon Bank will launch the pilot real estate program in Q3 2023 on Ripple’s CBDC platform.
The development was shared by Xu Luosheng, the executive president and chief strategy officer at Fubon Bank.
Under the initiative, Fubon Bank will leverage Ripple’s CBDC platform to tokenize real estate and issue loans in e-KHD. This will commence before the end of September 2023, the announcement read.
Stages of the Pilot Program
The pilot program’s first stage will involve issuing loans in digital Hong Kong dollars. Per the announcement, Fubon Bank will convert the fiat version of the Hong Kong dollar into a test-only digital Hong Kong dollar on a 1-to-1 exchange rate.
After the conversion, the test-only e-KHD will be issued to customers as loans. Luosheng noted that users can view their real-time loan-to-value ratio (LTV) using their e-KHD wallets.
In the second phase, customers can use the test-only digital Hong Kong dollars to purchase real estate properties and other related investments.
Furthermore, Luosheng revealed that Fubon Bank may consider collaborating with real estate companies to enable them to accept e-KHD as a payment method. Thus, bolstering the use of e-KHD.
It is worth noting that the pilot program does not involve the real issuance of digital Hong Kong dollars.
Meanwhile, Ripple’s CBDC Director Ross Edwards also commented on the initiative. Edwards explained that the Ripple CBDC platform would combine a hypothetical e-KHD, tokenized real estate, and financial lending agreements, using the XRP Ledger (XRPL).
The initiative is part of Hong Kong’s new e-HKD (electronic Hong Kong dollar) pilot program. Recall that Ripple partnered with Fubon Bank in May as part of the Hong Kong Monetary Authority’s (HKMA) e-HKD pilot program. Both Ripple and Fubon Bank will work on real estate tokenization using e-KHD.
Wu Blockchain further highlighted the news.
Fubon Bank (Hong Kong) said that it will test the real estate tokenization program in the third quarter, using the Ripple CBDC platform to tokenize the property and issue loans in testing digital Hong Kong dollars to speed up the process. https://t.co/3t6HTZhdeb
— Wu Blockchain (@WuBlockchain) July 29, 2023
Ripple to Revolutionize the Real Estate Industry
Interestingly, Ripple has disclosed plans to revolutionize the real estate industry using tokenization. With the tokenized asset industry expected to reach $16T by 2030, Ripple has started making efforts to benefit massively from its business opportunity.
As reported last year, Ripple partnered with Portugal-based real estate company ProprHome to revamp the country’s real estate sector.
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