Hong Kong and Shanghai Banking Corporation (HSBC) have tested the use of tokenized deposits in a sandbox set up by the Hong Kong Monetary Authority, from issue through transfer to redemption, with the help of Ant Group, a Chinese financial services provider founded by Jack Ma.
The financial institutions spearheaded an attempt to investigate how deposit tokenization would facilitate constant, real-time movement of treasury funds across a corporation’s accounts within the HSBC network.
During the test, Ant Group’s banking partners supported and enabled HSBC to join the blockchain platform. As per HSBC, the test included deposit token issuance, transfer, and redemption. HSBC added, “It will pave the way for future research on how blockchain and tokenization can drive efficiencies and foster innovations in corporate treasury management.”
The participation of Ant Group’s banking partners improves the speed, economy, and visibility of treasury fund transfers. Vincent Lau, global head of emerging payments and global payments solutions, demonstrated that tokenized deposits and other financial innovations can be used by HSBC to improve and streamline treasury management for customers.
Additionally, HSBC has actively participated in several central bank digital currency efforts, including Project mBridge, a swift cross-border CBDC program.