What’s new: A unit of banking giant HSBC Holdings PLC has introduced a tokenized gold product for retail investors in Hong Kong as part of the city’s drive to become a global hub for virtual assets.
The product, HSBC Gold Token, is powered by the bank’s Orion digital assets platform and can be traded through its online banking platform and HSBC HK mobile app, according to a statement HSBC Ltd. released on Wednesday.
Tokens digitalize physical assets and when buyers invest in the product, no physical delivery of gold is involved and ownership rights are stored digitally on a blockchain. Buyers have what is known as “fractional ownership” of the gold, meaning ownership of one gold bar represented by HSBC Gold Tokens may be shared among multiple investors.
Gold has long been popular among retail investors in Hong Kong. Maggie Ng, head of wealth and personal banking at HSBC Hong Kong, said there has been growing demand for digital assets, and that tokenized gold provides opportunities for individuals to experience digital asset investment.
The background: Gold Token is the latest initiative by HSBC in Hong Kong to digitalize traditional financial assets, reflecting the region’s role in driving financial innovation.
In June 2023, Hong Kong’s Securities and Futures Commission implemented a licensing regime for virtual asset trading platforms.
On Feb. 20, the Hong Kong Monetary Authority, the city’s de facto central bank, issued guidance for the banking industry on the sale and distribution of tokenized products, expressing continued support for such practices, while setting out rules and provisions for risk management.
Last month, HSBC delivered a four-currency digital green bond issued by the Hong Kong government, equivalent to HK$6 billion ($767 million).
Contact reporter Qing Na (qingna@caixin.com) and editor Nerys Avery (nerysavery@caixin.com)
