HSBC will unveil a custody service in 2024 to hold blockchain-based assets, not including cryptocurrencies, according to multiple media reports, the banking giant announced on Wednesday.
HSBC’s custody service will allow institutional clients to store tokenized versions of traditional financial assets rather than cryptocurrencies or stablecoins.
“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, Zhu Kuang Lee, HSBC chief digital, data and innovation officer, said in a press release. “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.”
The news follows the launch last year of the HSBC Orion digital asset platform, which lets financial institutions create tokenized securities. HSBC is among a number of major financial services organizations who have been expanding their presence in the digital asset space.
The service will be developed in partnership with Swiss firm Metaco, which also has tie-ins with CitiBank, Societe Generale and DekaBank. Earlier this week, German banking leader DZ launched its new blockchain-backed custody platform in partnership with Metaco.
“Custody infrastructure…will be critical to how issuers and investors interact, as capital markets and assets in general continue to be represented on distributed ledgers,” Metaco CEO and founder Adrien Treccani said in the announcement.