HSBC, Ripple-Backed Metaco to Launch Tokenized Custody Service Next Year
TLDR:
- HSBC teams up with Metaco, backed by Ripple, to launch a tokenized securities institutional custody platform in 2024.
- The platform, targeted at digital asset custody, involves tokenized securities, representing various real-world assets via blockchain technology.
- Metaco, acquired by Ripple for $250 million, offers Harmonize, an institutional platform ensuring secure operations for digital assets.
- HSBC’s push into tokenized assets follows successful trials and ETF launches, further solidifying their presence in the evolving crypto space.
- Ripple’s acquisition of Metaco showcases a strategic step in providing institutional-grade tokenization tools, serving entities like Citi and Union Bank.
HSBC has announced its partnership with Metaco, a tech company backed by Ripple. This collaboration aims to unveil a groundbreaking institutional custody platform for tokenized securities, slated for the year 2024.
HSBC, a financial powerhouse in Europe with a staggering $9.1 trillion in custody at the end of 2022, is gearing up to launch this new service in sync with its existing digital asset issuance platform, HSBC Orion.
This development also complements the bank’s recent introduction of a gold tokenization solution.
The decision to dive into this emerging space stems from the rising demand for custody and fund administration of digital assets, as articulated by Zhu Kuang Lee, Chief Digital, Data, and Innovation Officer at HSBC.
The surge in this demand is coming from asset managers and asset owners who are keen to capitalize on digital assets’ potential.
1/3 📰@HSBC announced that it is working with @metaco_sa as it plans to launch a new digital assets custody service for institutional clients who invest in tokenised securities.
— Metaco (@metaco_sa) November 8, 2023
To learn more: https://t.co/aI6IiaEvhu
cc @MonicaLongSF @seamus_don @AdrienTreccani @Ripple pic.twitter.com/KiBCZVAqeA
Tokenized securities, at the heart of this collaboration, are often built on blockchain technology. They open doors to the creation of digital replicas of real-world assets, spanning stocks, ETFs, or bonds.
However, the scope isn’t limited to traditional financial assets. Tokenized securities can be extended to other securitizable assets, including real estate, and can also serve as a vehicle for raising capital by offering fractionalized ownership through digital tokens instead of traditional stock issuance.
As part of this exciting initiative, HSBC is joining forces with Metaco, a technology provider that became part of the Ripple family through a $250 million acquisition in May this year. Metaco offers Harmonize, an institutional platform that fosters secure and streamlined digital asset operations.
Adrien Treccani, CEO and Founder of Metaco, expressed enthusiasm about this collaboration: “Metaco is excited to be working with HSBC as it continues to explore the applications of DLT in asset creation and custody.”
He emphasized the significance of custody infrastructure, such as Metaco’s Harmonize, in enabling seamless interaction between issuers and investors, aligning with the global trend of assets being recorded on distributed ledgers.
Ripple’s Acquisition of Metaco for Tokenization Push
In another chapter of the evolving digital asset landscape, Ripple made a substantial move by acquiring Swiss digital asset custody company Metaco for a remarkable $250 million.
This acquisition has made Ripple the sole shareholder of Metaco, while Metaco continues its operations as an independent brand.
The core offerings of Metaco include tokenization tools and custody infrastructure for institutions seeking to scale new business models within the crypto economy.
Notably, they’ve already extended their services to financial giants like Citi, Union Bank, and Bank BNP Paribas.
The move into tokenized securities is not a new venture for HSBC, as evidenced by their successful trial of tokenized deposits in collaboration with Ant Group, a prominent Chinese financial services company.
Furthermore, the Hong Kong division of HSBC introduced Bitcoin and Ethereum ETFs tied to futures contracts on the Chicago Mercantile Exchange (CME) earlier this year.
This forward-thinking partnership between HSBC and Metaco marks an exciting step toward the widespread adoption of digital asset custody services, ultimately benefiting the evolving crypto economy.
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