The Hong Kong Monetary Authority (HKMA) has introduced a framework to evaluate how prepared banks are for threats from quantum computing as Hong Kong broadens its use of tokenized deposits, digital assets and blockchain-based settlement.

On Monday, the HKMA released a white paper on quantum preparedness and launched the banking sector’s first Quantum Preparedness Index (QPI). The index assigned the sector an overall readiness score of 2.3 out of 10. The white paper also found that about half of the surveyed institutions had no formal post-quantum planning in place. The score gives the regulator a baseline for measuring whether banks are moving from early assessment toward implementation before its 2030 target.

The HKMA said it is targeting full sector readiness by 2030, which would be represented by a QPI score of 10.

The initiative comes as Hong Kong shifts more traditional financial activity onto distributed ledgers. Government data show that the city has issued three batches of tokenized green bonds totaling about HK$16.8 billion, or about $2.1 billion, since 2023. The HKMA is also developing tokenized deposits and digital-asset settlement through Project Ensemble.

According to the HKMA white paper, distributed ledger applications and payment networks rely on cryptography for core functions and could experience severe disruption if those protections were compromised. As more regulated financial instruments and settlement processes use blockchain-based infrastructure, the security of digital signatures, identity verification and transaction authorization becomes part of the operating resilience of those systems.

The paper said one surveyed institution had completed a proof of concept applying post-quantum cryptography to distributed-ledger connectivity. It also cited HSBC’s 2024 use of quantum-safe technology to move tokenized gold across distributed ledgers.

Tokenization push increases focus on quantum risks

The quantum-preparedness initiative follows the HKMA’s Fintech 2030 strategy, launched in 2025, which made tokenization one of four strategic pillars in a program covering more than 40 initiatives.

Under that strategy, the regulator said it would accelerate real-world asset (RWA) tokenization, regularize tokenized government bond issuance and examine tokenized Exchange Fund papers. It also said blockchain settlement would be supported by e-HKD, tokenized deposits and regulated stablecoins.

In a Feb. 11, 2026, speech, Hong Kong Financial Secretary Paul Chan said banks in Hong Kong held more than HK$14 billion, or about $1.785 billion, in digital assets under custody at the end of 2025, an increase of about 180% year over year. He also said tokenized deposits had reached HK$29 billion, or $3.7 billion.

The HKMA white paper said quantum computers capable of running Shor’s algorithm at scale could eventually break widely used RSA and elliptic-curve cryptography. That capability could allow attackers to decrypt protected data or forge the digital signatures used to authorize transactions, verify identities and establish trust across financial systems.

Because the replacement of embedded cryptographic systems can take years, the HKMA urged banks to begin inventories, risk assessments and migration planning before such machines become available.