HSBC, a major global banking institution, has partnered with Metaco, a Ripple-owned technology startup, to build an institutional custody platform for tokenized assets.
HSBC, a major global banking institution, has partnered with Metaco, a Ripple-owned technology startup, to build an institutional custody platform for tokenized assets.
HSBC, which has $5.6 trillion in custody, plans to debut this new service in 2024, alongside its existing digital asset issuance platform, HSBC Orion, and a recently launched gold tokenization solution.
According to HSBC's Chief Digital, Data, and Innovation Officer Zhu Kuang Lee, said:
“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.”
Tokenized securities, which are frequently constructed on blockchain technology, allow for the digital representation of physical assets such as stocks, ETFs, or bonds. They can also be used to securitize other assets, including real estate, and to raise funds by selling fractionalized ownership via digital tokens rather than traditional stock issues.
The relationship between HSBC and Metaco, which was acquired by Ripple in May for $250 million, focuses on Metaco's Harmonize, an institutional platform that ensures secure and uniform digital asset operations. This partnership is part of HSBC's larger investigation into distributed ledger technology (DLT) applications in asset generation and custody.
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