HSBC launches tokenized gold for retail customers in Hong Kong

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Global financial giant HSBC (NASDAQ: HSBC) has announced the launch of tokenized gold in Hong Kong, which will be available to retail customers for the first time.

The HSBC Gold Token is available on the bank’s online banking platform and mobile app. It follows up on the bank’s move last November when it announced a new platform to tokenize gold held in its vault in London, making it easier to trade and transfer.

HSBC Gold Token will be underpinned by HSBC Orion, the bank’s digital assets platform. The bank has previously used Orion to deploy digital bonds, including a $750 million digital green bond in Hong Kong.

Commenting on the new token, general manager Maggie Ng described it as a pioneer in the Hong Kong market.

“We are proud that HSBC Gold Token, powered by HSBC Orion, is the first retail product in Hong Kong that is based on distributed ledger technology, as authorized by the Securities and Futures Commission,” said Ng, who also heads the personal banking department at the bank.

HSBC’s token is the product of concerted efforts by Hong Kong authorities to promote
tokenization. The city-state has been at the forefront of tokenizing real-world assets, a sector that some say will be worth $15 trillion by the decade’s end.

As Ng noted, this push for tokenization blends perfectly with the existing familiarity of its client base with gold, making the Gold Token an ideal first product in this line.

Tokenized gold has become a billion-dollar market as the global tokenization revolution surges on. According to CoinGecko, the sector’s market capitalization stands at $1.078 billion. However, most players dominating the sector are unavailable to the regulated traditional finance industry, giving HSBC an advantage.

“Asset tokenization can enable convenient, affordable, and broad access to real-world and financial assets, in this case, the HSBC Gold Token,” commented Sami Abouzahr, the head of wealth solutions at HSBC HK.

While Hong Kong has taken the lead, other countries are making significant leaps with tokenization. Israel recently announced the results of Project Eden, an initiative that leveraged blockchain technology to tokenize government bonds.

In Germany, Deutsche Börse is working on a platform for making tokenized assets fungible, while in the United States, Citibank (NASDAQ: C) is working on tokenizing private equity funds.

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