HSBC trials tokenized deposits using Ant Group's blockchain technology

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HSBC trials tokenized deposits using Ant Group's blockchain technology
Credit: © Reuters.

HSBC has successfully trialed tokenized deposits for intra-group treasury transactions using Ant Group's blockchain technology. The trial, conducted under the Hong Kong Monetary Authority's Fintech Supervisory Sandbox arrangement, aimed at evaluating the potential of deposit tokenization in enabling real-time, continuous treasury fund transfers within HSBC's corporate accounts.

The test involved issuing, transferring, and redeeming deposit tokens via the Ant Group's blockchain platform that facilitates global treasury payments in multiple currencies. Vincent Lau of HSBC highlighted the advanced banking capabilities demonstrated through this trial in Hong Kong.

In addition to this initiative, HSBC has been active in several successful Central Bank Digital Currency (CBDC) pilots, including Project mBridge and a cross-border CBDC payment orchestration pilot organized by Swift. The bank has also collaborated with other banking institutions to explore an interoperable digital money platform known as the regulated liability network.

Earlier in 2023, HSBC launched cryptocurrency services, offering Bitcoin and Ethereum ETFs listed on the Hong Kong exchange. These included CSOP Bitcoin Futures ETF, CSOP Ethereum Futures ETF, and Samsung (KS: 005930 ) Bitcoin Futures Active ETF. This move into cryptocurrency services aligns with the bank's continued interest in utilizing financial innovations like tokenized deposits for improved treasury management.

The recent test with Ant Group could spur future research into how blockchain and tokenization can enhance corporate treasury management efficiency. As financial institutions continue to explore innovative technologies for efficiency and real-time transactions, these successful trials mark significant steps forward.

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