HSBC Holdings plc announced it will introduce a new digital assets custody service for its institutional clients that put money into tokenized securities. To offer this solution, the British universal bank and financial services group, teamed up with Ripple-owned Metaco, an enterprise technology company based in Switzerland.

HSBC is planning the launch of the tokenized securities custody service next year. The bank will use Metaco’s Harmonize solution platform to set up the service where clients can store their blockchain-based digital assets, except cryptocurrencies, as per Reuters.

HSBC’s Answer to Growing Demand for Digital Assets Custody Service

The UK-headquartered bank previously said it created tokens that represent physical gold which is currently being held in its vault in London. This comes after it launched a digital asset platform last year called the HSBC Orion. This issue blockchain-based versions of actual financial assets commonly known as tokenized securities.

HSBC’s chief digital, data, and innovation officer, Zhu Kuang Lee, said that it saw a surging demand for custody of digital assets as well as fund administration. This shows that this line of market continues to develop thus the company is launching this exact service that asset managers and owners want and need.

“Through key partnerships, HSBC is delivering the next-generation custody infrastructure that will be scalable and secure. For asset servicers, there has never been a more important time to innovate, to collaborate and to create change,” he said.

When Will the Service Be Available

HSBC and Metaco are activating the new digital assets custody for tokenized securities in 2024 - no exact date yet as of this time. The Block further reported that this service that will use Metaco’s Harmonize platform is an extension to the bank’s existing HSBC Orion.

“Metaco is excited to be working with HSBC as it continues to explore the applications of DLT in asset creation and custody,” Metaco’s founder and CEO, Adrien Treccani, said in a press release. “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.”

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