HSBC is planning to launch a new digital asset custody service for institutional customers that invest in tokenised securities.
The move comes days after HSBC announced it is now the first bank in the world to offer tokenised gold.
The bank said that the new service, set to go live next year, will use HSBC Orion – its platform for issuing digital assets – as well as the recently launched tokenised physical gold offering.
Last year, HSBC announced a major push into blockchain-based tech through the launch of its proprietary tokenisation platform last year.
The HSBC Orion platform allows financial institutions and corporates to issue digital bonds based on distributed ledger technology.
HSBC says that it is working with Swiss enterprise tech firm Metaco to use its institutional platform, which helps unify security and management of digital asset operations, as part of its new custody service for digital assets.
“We’re seeing increasing demand for custody and fund administration of digital assets from asset managers and asset owners, as this market continues to evolve," said Zhu Kuang Lee, chief digital, data and innovation officer, Securities Services, HSBC. "Through key partnerships, HSBC is delivering the next-generation custody infrastructure that will be scalable and secure."
Kuang added that for asset servicers, there has "never been a more important time to innovate".
Last week HSBC launched its first trades tokenising the ownership of physical gold held in the bank’s London vault using distributed ledger technology (DLT).
To carry out the trades, HSBC created a digital twin of an existing physical asset, specifically loco London gold custodied in its vault.
HSBC says that tokenised physical gold can now be traded between the bank and institutional investors through the HSBC Evolve single dealer platform, or through an API.
“I’m excited by the forthcoming launch of our new custody service for digital assets, which will complement HSBC Orion, our platform for issuing digital assets, as well as our recent launch of tokenised physical gold," said John O’Neill, global head of digital assets strategy, markets and securities services, HSBC. "These services underscore HSBC’s commitment to the overall development of digital asset markets.”
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