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HSBC and Ant Group test tokenized deposits under HKMA sandbox

HSBC and Ant Group test tokenized deposits under HKMA sandbox

Banking giant the Hong Kong and Shanghai Banking Corporation (HSBC) has conducted a test of tokenized deposits in collaboration with major Chinese financial services provider Ant Group, founded by Jack Ma, in a sandbox arranged by the Hong Kong Monetary Authority.

The objective of the initiative, led by both banking institutions, was to explore the potential of deposit tokenization in facilitating real-time fund movement between accounts held by a corporation within the HSBC network.

During the test, HSBC utilized Ant Group’s blockchain platform, supported by Ant Group’s banking partners. HSBC stated that the test involved the issuance, transfer, and redemption of deposit tokens, and expressed its belief that the results will contribute to future research on the application of blockchain and tokenization in corporate treasury management.

The involvement of Ant Group’s banking partners enhances treasury fund transfer by improving turnaround time, cost efficiency, and visibility. Vincent Lau, global head of emerging payments and global payment solutions at HSBC, confirmed HSBC’s interest in leveraging tokenized deposits and other financial innovations to enhance treasury management for clients.

In addition to this initiative, HSBC has also been actively participating in various central bank digital currency initiatives, including the Swift cross-border CBDC initiative Project mBridge.

Related: HSBC trialing quantum-safe financial transaction network in the UK

According to reports, HSBC introduced its first local cryptocurrency services in June 2023.

Reportedly, HSBC would offer cryptocurrency exchange-traded funds listed on the Stock Exchange of Hong Kong, including CSOP Bitcoin Futures ETF, CSOP Ethereum Futures ETF, and Samsung Bitcoin Futures Active ETF.

HSBC has not yet responded to Cointelegraph’s request for comment.

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