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1. Hong Kong issues record $1.3B digital green bond
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The government of Hong Kong has issued its largest digital green bond, raising $1.3 billion through four tranches denominated in Hong Kong dollars, renminbi, US dollars and euros. The bond, which is traded on a blockchain-based exchange, attracted strong demand, with total subscriptions surpassing $16 billion. South China Morning Post (Hong Kong) (11/11) Ledger Insights (Cyprus) (11/12) ESG Today (11/12)
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2. Analysis: SEC's Project Crypto to clarify digital asset regulation
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SEC Chairman Paul Atkins has outlined the next phase of Project Crypto, which aims to bring legal clarity to digital assets through a formal token taxonomy and the forthcoming Regulation Crypto. The SEC has issued statements clarifying the application of federal securities laws to activities such as meme coins, proof-of-work mining and stablecoins, but questions remain about crypto asset distributions and the status of certain tokens as securities. Sidley Austin (11/16)
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3. FICC plans separate default fund before SEC clearing rule
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Risk (subscription required) (11/17)
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4. Commentary: Merging SEC, CFTC best way to regulate digital finance
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Merging the Securities and Exchange Commission and the Commodity Futures Trading Commission could be the most effective way to regulate digital assets, writes former CFTC Chairman Timothy Massad, who notes that market-structure legislation should create federal regulation of the spot market for digital assets that are not securities, clarify the classification of digital assets, ensure back-office regulations work for tokenized assets and strengthen tools to prevent illicit finance. Massad says the current proposals to regulate digital assets could do more harm than good and that a merger of the SEC and the CFTC would be more effective. Brookings Institution (11/17)
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5. Trading desks invest in tech to support muni bond surge
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Trading desks have become increasingly active in response to the record pace of municipal bond trading this year. Firms like AllianceBernstein and RBC Capital Markets report busier environments, requiring traders to be more responsive and available than ever before. To handle the surge in activity, desks are investing in technology, expanding their teams, and streamlining processes such as deal allocations and trade pricing. These adaptations are aimed at efficiently managing the heightened trading volumes driven by increased bond issuance and market volatility. Bloomberg (11/13)
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6. SEC's Atkins outlines "token taxonomy" for digital assets
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SEC Chair Paul Atkins has announced plans to create a "token taxonomy," signaling a major shift in how digital assets are regulated. The proposal could mean that many tokens will no longer be treated as securities, aligning with recent legislative efforts like the Stablecoin Law and the GENIUS Act. While industry veterans have praised the approach for offering regulatory clarity, investor-protection lawyers have raised concerns about potential risks and the need for robust market-structure legislation. Bloomberg (11/13)
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7. Commentary: Algos, voice trading work side-by-side in bond markets
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The bond market has seen a surge in algorithmic trading, with US Treasurys now trading in milliseconds and corporate credit volumes increasing significantly. However, electronic trading volumes have plateaued at about 50% for corporate bonds and 60% for Treasurys, as voice trading remains essential for large, bespoke deals. Zornitsa Todorova, head of thematic fixed income research at Barclays, writes that the coexistence of algos and human traders has improved liquidity and market speed, but human judgment continues to play a crucial role, especially in volatile conditions. Financial Times (11/05)
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8. Societe Generale issues digital bond using Broadridge tech
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Societe Generale has issued its first US digital bond using Broadridge Financial Solutions' new tokenization capability, with DRW Holdings acquiring the bond. The bond was issued on the Canton Network, which Digital Asset founded, and the security tokens were registered by Societe Generale-FORGE, Societe Generale's digital asset subsidiary. Finance Magnates (11/18) Ledger Insights (Cyprus) (11/18)
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9. FDIC plans guidance on tokenized deposits
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Federal Deposit Insurance Corp. acting Chair Travis Hill said the agency is developing guidance for tokenized deposit insurance, an effort to help financial institutions expand their digital-asset presence. "A deposit is a deposit," Hill said at a Federal Reserve Bank of Philadelphia conference. "Moving a deposit from a traditional-finance world to a blockchain or distributed-ledger world shouldn't change the legal nature of it." Bloomberg (11/13) FinanceFeeds (11/14)
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10. Japan, Hong Kong, Singapore lead tokenized finance
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Japan, Hong Kong and Singapore are leading the adoption of tokenized finance with regulatory advancements and innovative financial products. Japan's Financial Services Agency is enhancing custody rules and aligning crypto with traditional finance. Hong Kong is standardizing digitally native bond issuance, reducing settlement times and costs. Singapore has approved its first retail tokenized fund, providing a substantial base for tokenized assets. These developments are expected to increase liquidity and integration with the crypto market, driven by regulatory clarity and operational efficiencies. CryptoSlate (11/14)
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