HSBC has launched its Hong Kong dollar-backed stablecoin, RedCoin, beginning a phased rollout on October 23 that will allow more than 3.3 million PayMe users to make transfers and payments at
HSBC has launched its Hong Kong dollar-backed stablecoin, RedCoin, beginning a phased rollout on October 23 that will allow more than 3.3 million PayMe users to make transfers and payments at over 100,000 merchant locations across Hong Kong.
The stablecoin, officially known as HSBC RedCoin (RCHKD), is pegged one-to-one to the Hong Kong dollar and operates under a licence granted by the Hong Kong Monetary Authority (HKMA) in April 2026.
Customers can activate a RedCoin wallet directly within PayMe after updating the application, without opening an additional bank account or maintaining a minimum balance. HSBC expects the functionality to reach its entire PayMe user base before the weekend.
RedCoin initially supports person-to-person transfers and payments to participating merchants through PayMe, preserving the familiar interface and transaction process already used by millions of Hong Kong residents.
Users can convert HK$1 into one RedCoin and select their stablecoin wallet when sending money or paying for purchases.
Lawrence Li, HSBC’s head of retail banking products and CEO of PayMe, said the initial deployment prioritizes transaction reliability, convenience and customer confidence rather than maximizing circulation immediately.
The bank completed an internal pilot involving nearly 100 employees, testing the process from stablecoin issuance and wallet activation to transfers.
To encourage adoption, HSBC is preparing promotional incentives, including transaction vouchers, merchant discounts and RewardCash benefits. Existing PayMe promotions will remain available, although the bank has not disclosed the full terms of its RedCoin rewards program.
The launch follows HSBC’s September unveiling of RedCoin, when the lender outlined plans to introduce stablecoin payments through its existing retail platforms before expanding into institutional financial services.
The bank plans to integrate RedCoin into its HSBC HK mobile banking application before the end of 2026, extending the token beyond everyday payments.
The next phase will allow eligible customers to subscribe to tokenized investment products using RedCoin, beginning with a Hong Kong dollar money market fund requiring a minimum investment of HK$100 (approximately $13).
John O’Neill, HSBC’s managing director for digital assets and currencies, identified faster subscriptions and settlement as potential advantages of stablecoin-based investment transactions.
The proposed functionality would reduce the time needed to subscribe to eligible investment products compared with conventional processes that can take several days to complete.
HSBC is also considering additional tokenized funds, gold products and services for corporate and institutional customers, although those offerings are not part of the initial PayMe rollout.
The bank has already expanded its digital asset operations through tokenized bonds, deposits and gold products. Its cumulative digital bond issuance activity has reached approximately $8.5 billion, while tokenized gold has generated around $2.5 billion in transaction value.
HSBC became one of Hong Kong’s first two licensed stablecoin issuers on April 10, alongside Anchorpoint Financial, a consortium backed by Standard Chartered, Animoca Brands and HKT.
The bank holds HKMA licence FRS02, requiring RedCoin to maintain full backing through high-quality liquid assets held in segregated reserves.
HSBC’s official product terms provide for redemption at a one-to-one Hong Kong dollar rate. RedCoin itself does not pay interest, distinguishing the payment token from the investment funds HSBC plans to make accessible through its banking application.
Anchorpoint has pursued a different initial distribution strategy, focusing on institutional users after completing HKDAP settlement testing on Ethereum earlier this year.
HSBC’s retail launch instead places regulated stablecoin payments within an established consumer platform, avoiding the need for customers to adopt a separate cryptocurrency exchange or external wallet.
The HKMA has also warned against fraudulent tokens impersonating licensed issuers. HSBC has not authorized third-party platforms to distribute or exchange RedCoin, limiting official access to its designated banking and payment applications.
Following the PayMe launch, HSBC’s next scheduled milestone is the addition of RedCoin wallets and tokenized investment subscriptions to its Hong Kong mobile banking app before December 31, 2026.
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