HSBC to Launch Institutional Grade Custody Service for Tokenized Securities

HSBC is expanding its presence in the digital assets market with a plan to launch an institutional-grade custody service for tokenized securities. The service is set to go live in 2024 and will use technology from Metaco, a Swiss crypto safekeeping firm owned by Ripple.

Complementing HSBC Orion

The upcoming custody service is designed to supplement HSBC Orion, the London-based bank’s platform for issuing digital assets. It will also complement HSBC’s recently introduced service for tokenized physical gold. Zhu Kuang Lee, Chief Digital, Data and Innovation Officer, Securities Services at HSBC, noted that there’s a rising demand for custody and fund administration of digital assets from asset managers and asset owners, and this market continues to evolve.

A Focus on Tokenized Securities

HSBC emphasizes that it won’t be involved in the safekeeping of cryptocurrencies or stablecoins. The bank’s focus will be on tokenized securities issued on third-party platforms, such as public blockchain-compatible tokenized bonds or tokenized structured products.

John O’Neill, Global Head of Digital Assets Strategy, Markets and Securities Services at HSBC, expressed his excitement about the upcoming launch, stating that these services underscore HSBC’s commitment to the overall development of digital asset markets.