Hong Kong’s largest bank, HSBC, has launched tokenized gold products for retail clients as the government pushes for real-world asset tokenization. In the retail market, HSBC claims to be the first bank to create a blockchain-based real-world asset (RWA). Last November, HSBC partnered with Swiss crypto custody specialist Metaco to create a gold tokenization product.
This launch comes in just as the crypto market is high on bullish sentiments with the crypto fear and greed index signaling “extreme greed” with 82 points.
Hong Kong ventures into RWA with gold tokenization
On Wednesday the bank announced that retail customers can access the HSBC Gold Token via online banking and the bank’s mobile app. “The launch marks the first time HSBC’s private distributed ledger is being used to tokenize a retail investment product,” it said in the statement.
According to the press release, the bank built the HSBC Gold Token using its digital assets platform, HSBC Orion and has previously launched digital bonds in Hong Kong and Luxembourg.
“We are proud that HSBC Gold Token, powered by HSBC Orion, is the first retail product in Hong Kong that is based on distributed ledger technology, as authorised by the Securities and Futures Commission,” Maggie Ng, general manager and head of wealth and personal banking Hong Kong, said.
In November 2023, HSBC announced it would offer custody services for digital assets, including tokenized securities, in partnership with Metaco, a Swiss crypto company. HSBC also launched a platform in November to tokenize ownership of physical gold held in its London vault.
In the traditional finance industry, tokenization has become an emerging trend. SC Ventures, for example, launched a tokenization platform called Libeara in November.
Last year’s announcement
In November 2023, HSBC introduced its gold tokenization platform, constructed on distributed ledger technology (DLT). Permitting clients to possess tokenized ownership of physical gold held in the bank’s vaults in London.
Each token represented 0.001 troy ounces of gold, facilitating institutional investors in trading and managing their gold holdings more efficiently. Using the platform clients’ physical gold holdings were represented digitally, which enhanced transparency and streamlined trading.
HSBC’s global head of FX and commodities partnerships and propositions, Mark Williamson, talked about how precious metals trading could be modernized. Using the serial number and vault information, clients could track their gold bullion. That made it easier to find specific bars.
The goal was to extend the tokenization approach to other precious metals leveraging blockchain’s efficiency and security.
