HSBC launches gold token in Hong Kong

The tokenization of real-world assets (RWAs) is progressing. HSBC is now launching a gold token for retail investors. What this means.

News from the Far East: HSBC is the world's eighth-largest bank to launch tokenized gold products for retail customers in Hong Kong. The local government in the metropolis has been pushing property tokenization (RWA) for some time.

With this initiative, HSBC is the first bank to offer retail investors a tokenized real-world asset on a blockchain platform. According to the bank retail customers can access the HSBC Gold token through online banking and its app.

So RWA tokenization is increasingly becoming a hot trend in traditional finance.

The company has previously hinted at offering tokenized gold as part of its custody platform for digital assets. In November 2023, HSBC announced a partnership with Swiss custody platform Metaco.

"We are proud that the HSBC Gold Token, powered by HSBC Orion, is the first retail product in Hong Kong based on [...] ledger technology," said Maggie Ng, head of Wealth and Personal Banking at HSBC Hong Kong.

By converting physical gold into digital tokens, investors can hold a fraction of gold without high token premiums. In addition, HSBC also now no longer needs to store physical gold, which also reduces costs.

The integration of blockchain technology into traditional banking shows a shift to a new, digital ecosystem. The tokenization of gold could be just the first step, as theoretically any asset can be mapped to the blockchain.