HSBC Bank (China) Ltd. announced on Friday the launch of digital yuan (e-CNY) services for corporate clients, becoming one of the first international banks to provide these services to both corporate and retail customers. The e-CNY, or digital yuan, is China’s central bank digital currency (CBDC) issued by the People’s Bank of China (PBOC). Following […]
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Marketnode Secures Series A Funding Led by Financial Services Giant HSBC
On Thursday, Singapore’s Marketnode, a digital market infrastructure operator, secured funding for its Series A financing round led by HSBC, the British multinational universal bank and financial services group. The exact amount raised during the Series A funding was not disclosed. HSBC Joins Forces With Marketnode to Revolutionize Digital Asset Solutions HSBC has backed Marketnode, […]
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HSBC to Expand Tokenized Asset Offerings — CEO Says He’s ‘Very Comfortable’ With Tokenization
Hong Kong’s leading commercial bank, HSBC, continues to invest in its tokenization product lineup. The bank’s CEO, Noel Quinn, stated that he is “very comfortable with the concept of tokenization.” He indicated that the bank will look at ways of tokenizing assets backed by “real” assets. HSBC’s CEO Discusses Tokenization Plans Hong Kong’s leading commercial […]
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HSBC Launches Tokenized Gold Product Targeting Hong Kong Market
HSBC, the London-based financial institution, launched the first bank-backed tokenized gold product for its customers in Hong Kong. HSBC Gold Token will allow retail investors to purchase tokenized gold from their smartphones using the bank’s online app, democratizing access to these gold contracts for retail customers and leveraging distributed ledger technology. HSBC Debuts Tokenized Gold […]
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HSBC Announces Plans to Offer Digital Assets Custody Services for Institutions
HSBC, the London-based financial institution, announced its plans to launch an institution-focused digital assets custody service in 2024. Zhu Kuang Lee, chief digital, data and innovation officer at HSBC, explained that the bank had experienced an increasing demand for these services from asset managers and asset owners.
HSBC Announces Digital Assets Custody Service
HSBC, a financial institution with a presence in more than 60 countries and over trillion in assets, has announced that it plans to launch a service to offer custody of digital assets for institutional customers. The service, which will go live in 2024, will come to complement the digital services offering of the bank, which expects to offer a comprehensive asset management suite for its customers worldwide.
The launch of this platform comes at the request of HSBC’s customers, who have been demanding these services. Zhu Kuang Lee, chief digital, data and innovation officer at HSBC, stated:
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.
Recently, the bank entered the gold tokenization markets, announcing the launch of a tool for customers to have more control over the status of their holdings, allowing them to trade their tokenized gold on HSBC’s platforms in the Greater London area. Also, HSBC announced Orion in 2022, a service for issuing tokenized assets.
Metaco’s Involvement
To develop this new platform, HSBC enlisted the help of Metaco, a Swiss-based company founded in 2015 that provides core services to manage digital assets. The bank will use Harmonize, a comprehensive suite that provides custody, tokenization, trading, and asset management services for regulated and non-regulated digital assets. BNP Paribas, Societe Generale, and Citi have also partnered with Metaco to use Harmonize in their operations.
Adrien Treccani, founder and CEO of Metaco, explained:
Custody infrastructure such as Metaco’s Harmonize, which integrates with financial institutions’ existing systems, will be critical to how issuers and investors interact, as capital markets and assets in general continue to be represented on distributed ledgers.
Metaco is owned by cryptocurrency and payments platform Ripple, which acquired it in March for 0 million to target the institutional custody market. At the time, Ripple’s president Monica Long declared she expected this industry to reach trillion by 2030.
What do you think about HSBC and its new digital assets custody offering? Tell us in the comment section below.
HSBC Launches Tokenization Platform for Gold Markets
HSBC announced the launch of a platform that will allow the tokenization of gold bullion, with a stated potential market reach of 5 billion. Mark Williamson, HSBC’s global head of FX and commodities partnerships and propositions, stated that these gold tokens will be tradable using HSBC’s platform, with the bank handling custody of the gold bars in its London vaults.
HSBC Enters Gold Tokenization Era
HSBC, one of the world’s largest financial institutions, has started using tokenization technology to modernize the precious metals trading industry. The bank announced it is launching a gold tokenization platform to simplify the trading of gold, to allow traders to have better control of the bullion they own, according to statements from Mark Williamson, HSBC’s global head of FX and commodities partnerships and propositions.
The gold bars in the platform will be tokenized, and the owners will have the chance to track their bullion via the serial number and the vault where it is located, making finding these bars “quicker and less cumbersome,” Williamson said. Currently, such records are kept manually and are sometimes outdated, given the nature of the over-the-counter gold markets.
Williamson also stated that HSBC projects to use this system, which uses tokens representing 0.001 troy ounces of gold, for markets of other precious metals as well.
While Williamson stated that the tokenization system could allow retail users to invest directly in gold fractions when regulations allow it, HSBC is currently only focusing on the institutional market, which has a potential reach of around 5 billion in the greater London area.
Previous Attempts
HSBC is not the first institution that has entered the gold tokenization market. In 2016, Paxos partnered with Euroclear to offer an on-chain settlement service for tokenized gold that dissolved a year later. However, Paxos still has a tokenized gold offering in the form of pax gold, a token that represents one fine troy ounce of gold held in the vaults of the London Bullion Market Association (LBMA).
Tether, the stablecoin company behind the issuance of USDT, also offers a gold token, XAUT. Nonetheless, what makes HSBC’s announcement significant is the sheer size of the bullion market that passes through its platforms, being one of the largest precious metals brokers in the world and also only one of four gold clearing institutions in the London market.
What do you think about the entrance of HSBC to the gold tokenization market? Tell us in the comments section below.
HSBC Enables Bitcoin and Ethereum ETF Trading on Mobile Apps in Hong Kong
Banking giant HSBC has begun letting customers buy and sell bitcoin and ethereum exchange-traded funds (ETFs) that are listed on the Hong Kong stock exchange (HKEX) using its mobile apps. The stock exchange currently has three crypto futures ETFs listed.
HSBC Customers Can Trade Crypto Futures ETFs Using Mobile Apps
Banking giant HSBC has reportedly begun allowing customers to buy and sell bitcoin and ethereum exchange-traded funds (ETFs) listed on the Hong Kong stock exchange (HKEX) through its mobile apps. Chinese reporter Colin Wu tweeted Monday:
HSBC, the largest bank in Hong Kong, today allows its customers to buy and sell bitcoin and ethereum ETFs listed on the Hong Kong exchange, and is also the first bank in Hong Kong to allow it. The move will expand local users’ exposure to cryptocurrencies in Hong Kong.
Wu further noted that HSBC has launched “Virtual Asset Investor Education Centre,” emphasizing: “Investors need to read and confirm the educational materials and risk disclosures in the Virtual Asset Investor Education Center before investing in any virtual assets-related products through HSBC HK Easy Invest app, HSBC HK Mobile Banking app, and online banking.”
Currently, there are three crypto ETFs listed on the Hong Kong stock exchange: CSOP Bitcoin Futures ETF (stock code: 3066), CSOP Ether Futures ETF (stock code: 3068), and Samsung Bitcoin Futures Active ETF (stock code: 3135).
The CSOP bitcoin and ether futures ETFs, which began trading on the HKEX in December last year, track the standardized, cash-settled bitcoin futures contracts and ether futures contracts traded on the Chicago Mercantile Exchange (CME) respectively. The Samsung bitcoin futures ETF was listed in January; it seeks to provide economic exposure to the value of BTC by investing predominately in front-month bitcoin futures on CME.
Hong Kong recently revamped its regulatory framework for crypto in an attempt to become a crypto and innovation hub. The new law went into effect on June 1. The Hong Kong Securities and Futures Commission (SFC) stated that its new regulatory regime “seeks to capture all the dimensions of the public’s interface with virtual assets, providing for investor protection and market integrity while managing key risks to financial institutions.”
Many people were quick to point out on social media that the cryptocurrency ETFs that customers can trade through HSBC’s apps are not spot crypto ETFs. In the U.S., the Securities and Exchange Commission (SEC) has approved several crypto futures ETFs but has yet to greenlight any crypto spot ETF.
Moreover, these crypto ETFs have been available through the HSBC Broking service since they were listed on the HKEX but were not available on mobile apps. HSBC Broking offers ETF trading on the Hong Kong Stock Exchange and other major markets around the world.
Hong Kong is setting itself apart from the United States in terms of regulatory approaches towards cryptocurrencies. While the U.S. SEC has been actively taking action against unregistered crypto trading platforms and securities tokens, including charging Coinbase for violations of security laws, Hong Kong has adopted a different stance. In response to developments in the U.S., Hong Kong legislator Johnny Ng invited Coinbase and other global crypto exchanges to apply for licenses in Hong Kong. The lawmaker stated, “I hereby offer an invitation to welcome all global virtual asset trading operators, including Coinbase, to come to Hong Kong for the application of official trading platforms and further development plans.”
HSBC recently filed trademark applications for a wide range of digital currency and metaverse services. The bank’s CEO, Noel Quinn, however, has said that crypto is not in HSBC’s future. In March, the bank joined the metaverse by partnering with blockchain virtual gaming platform The Sandbox. In May, the Hong Kong Monetary Authority (HKMA) announced that HSBC and 15 other firms have been selected to participate in the first round of e-HKD pilots for 2023.
What do you think about HSBC letting customers trade bitcoin and ethereum ETFs listed on the Hong Kong stock exchange using its apps? Let us know in the comments section below.
HSBC, Mastercard File More Crypto-Related Trademark Applications
HSBC and Mastercard, two major players in the banking and payment industries, have submitted additional trademark applications related to cryptocurrencies with the United States Patent and Trademark Office (USPTO). Mastercard’s filing focuses on crypto and blockchain transactions while HSBC’s application focuses on metaverse banking and services related to non-fungible tokens (NFTs).
HSBC and Mastercard Expand Crypto Footprint
HSBC and Mastercard have continued to file trademark applications with the United States Patent and Trademark Office (USPTO) for a wide range of crypto-related services.
USPTO attorney Mike Kondoudis tweeted Monday that Mastercard filed a new trademark application (serial no. 98038563) on June 12 for the word mark “Mastercard Crypto Credential.” It covers software for verifying interactions, processing or exchanging cryptocurrencies, and connecting virtual asset service providers (VASPs).
HSBC also filed a new crypto-related trademark application (serial no. 98037178) on June 12. The banking giant’s filing for the word mark “HSBC Innovation Banking” focuses on metaverse banking, consulting, financial services, virtual credit cards, and several services involving non-fungible tokens (NFTs).
In December last year, HSBC filed trademark applications for its name and logo covering a broad range of crypto-related services. In March, the bank joined the metaverse by partnering with blockchain virtual gaming platform The Sandbox. However, HSBC Group’s CEO, Noel Quinn, said in September that crypto is not in the bank’s future.
Mastercard has been focusing on crypto for quite some time. In April last year, Mastercard filed 15 metaverse and NFT-related trademark applications. Last November, the payment giant said it is focusing on five key areas to turn crypto into an everyday way to pay.
An increasing number of major corporations and financial services institutions have filed trademark applications for a broad range of digital currency and metaverse products and services, including Visa, Paypal, and Western Union.
What do you think about major companies continuing to file trademark applications covering a wide range of crypto and metaverse-related products and services? Let us know in the comments section below.
Hong Kong Launches Digital Currency Pilot With 16 Firms Including HSBC, Bank of China, Alipay
The Hong Kong Monetary Authority (HKMA) has announced the commencement of its e-HKD pilot which “will take deep dives into potential use cases in six categories.” The pilot paves the way for “the possible implementation of a retail central bank digital currency (CBDC),” the central banking institution explained.
Pilot Program for e-HKD Begins
The Hong Kong Monetary Authority (HKMA) announced Thursday “the commencement of the e-HKD Pilot Programme.” The central banking institution revealed that 16 firms from the financial, payment, and technology sectors have been selected to participate in the first round of e-HKD pilots for 2023. The HKMA detailed:
The pilots will take deep dives into potential use cases in six categories, including full-fledged payments, programmable payments, offline payments, tokenized deposits, settlement of Web3 transactions, and settlement of tokenized assets.
“The HKMA will conduct a series of pilots in close collaboration with various stakeholders to examine the use cases, as well as implementation and design issues relating to e-HKD,” the monetary authority described, adding that it aims to share key learnings with the public at Hong Kong Fintech Week 2023 in November.
The companies participating in the pilot program include Alipay Financial Services, Bank of China, China Construction Bank, Fubon Bank, Ripple Labs, Standard Chartered Bank, Hang Seng Bank, HSBC, Visa, Industrial and Commercial Bank of China, Mastercard Asia/Pacific, and Boston Consulting Group.
Eddie Yue, HKMA’s chief executive, commented: “While the HKMA has not yet made a decision on whether and when to introduce e-HKD, we are excited to kick-start the e-HKD Pilot Programme, which serves as a tremendous opportunity for the HKMA to collaborate with the industry in exploring innovative use cases and maximizing our readiness for a potential e-HKD.”
The Hong Kong Monetary Authority published its policy stance on e-HKD in September last year as part of its “Fintech 2025” strategy. Two rounds of market consultation were conducted: one on high-level technical design and one on key policy and design issues. A total of 75 responses were received during the consultation period.
The HKMA explained at the time that it will adopt a three-rail approach. Rail 1 establishes the technological and legal foundations for the e-HKD, Rail 2 explores use cases and conducts pilots, and Rail 3 focuses on launching e-HKD based on the outcomes of the previous phases.
“The e-HKD Pilot Programme is a key component of Rail 2 under the HKMA’s three-rail approach in paving the way for the possible implementation of a retail central bank digital currency (CBDC), i.e. e-HKD, in the future,” the HKMA noted in Thursday’s announcement.
Do you think Hong Kong should launch a central bank digital currency? Let us know in the comments section below.
HSBC Acquires Silicon Valley Bank UK — Sale Facilitated by Government, Bank of England
The British government and the central bank, the Bank of England, have facilitated a private sale of Silicon Valley Bank UK to HSBC, according to Chancellor of the Exchequer Jeremy Hunt. He stressed that “Deposits will be protected, with no taxpayer support.”
British Government Announces Acquisition of Silicon Valley Bank UK by HSBC
HSBC has acquired Silicon Valley Bank UK (SVB UK), the British subsidiary of Silicon Valley Bank (SVB) that was shut down by U.S. regulators on Friday. British Chancellor of the Exchequer Jeremy Hunt tweeted Monday:
This morning, the government and the Bank of England facilitated a private sale of Silicon Valley Bank UK to HSBC. Deposits will be protected, with no taxpayer support.
In a filing with the London Stock Exchange Monday, HSBC stated that its U.K. subsidiary, HSBC UK Bank plc, is acquiring Silicon Valley Bank UK Ltd. for £1 (.22). The filing details that as of March 10, “SVB UK had loans of around £5.5bn and deposits of around £6.7bn.” Moreover, for the financial year ending Dec. 22, 2022, the filing states that “SVB UK recorded a profit before tax of £88m,” adding that the British subsidiary’s “tangible equity is expected to be around £1.4bn.”
HSBC noted: “The assets and liabilities of the parent companies of SVB UK are excluded from the transaction. The transaction completes immediately. The acquisition will be funded from existing resources.”
Noel Quinn, HSBC Group’s CEO, commented:
This acquisition makes excellent strategic sense for our business in the U.K. It strengthens our commercial banking franchise and enhances our ability to serve innovative and fast-growing firms, including in the technology and life-science sectors, in the U.K. and internationally.
“SVB UK customers can continue to bank as usual,” the executive clarified, adding: “We warmly welcome SVB UK colleagues to HSBC, we are excited to start working with them.”
In the U.S., the Department of the Treasury, the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation (FDIC) have taken measures to protect SVB depositors. They announced Sunday: “Depositors will have access to all of their money starting Monday, March 13. No losses associated with the resolution of Silicon Valley Bank will be borne by the taxpayer.”
What do you think about HSBC acquiring Silicon Valley Bank UK for £1? Let us know in the comments section below.