Participates in the breakdown of the egg envelope, which is derived from the egg extracellular matrix, at the time of hatching. Thus allowing the newly hatched fish to swim free. HCE binds tightly to the egg envelope while it exerts the choriolytic swelling action. Hydrolysis of the inner layer of fish egg envelope. Also hydrolysis of casein and small molecule substrates such as succinyl-Leu-Leu-Val-Tyr-|-7-(4-methyl)coumarylamide. Binds 1 zinc ion per subunit. Stored as proenzymes in the zymogen granules. Production of the protein starts in day 2 to day 3 embryos and increases thereafter until hatching. In medaka the hatching enzyme system is composed of two distinct proteases, the high choriolytic enzyme (HCE), of which there are two isoforms, and the low choriolytic enzyme (LCE).