British multinational banking giant HSBC has tapped Ripple Labs-own Metaco to offer institutional-grade crypto custody service.
HSBC Holdings plc, formerly known as The Hong Kong and Shanghai Banking Corporation, is a British multinational bank and financial services group based in London, England, offering corporate clients room to safeguard tokenized digital assets. Based on a Bloomberg report, the proposed offering will go live in 2024.
The HSBC Metaco Partnership
Metaco, the Swiss-based firm acquired by Ripple earlier this year for $250 million, will power this HSBC offering. While the switch to crypto custody marks uncharted territory for HSBC, it will complement the firm’s existing digital issuance outfit called HSBC Orion.
HSBC Orion itself hinges on Distributed Ledger Technology (DLT) to issue tokens that account for the ownership of gold bullion it currently holds in its London vault. The pivot from core financial services to tokenization involving blockchain is an easy one for HSBC and stems from growing demand from its clients, according to Zhu Kuang Lee, the Chief Digital, Data, and Innovation Officer of securities Services at HSBC.
The choice of Metaco is a testament to the successful acquisition by Ripple. Since the duo closed the deal, Metaco has closed high-profile partnerships to advance its growing dominance in the institutional custody space. Earlier this year, Citigroup also contracted Metaco to help build its digital assets custody offering.
With Metaco currently deepening its foothold in the tokenization scene, securing the larger share of the industry projected to top $10 trillion by 2030 remains the primary goal. It is worth noting that more crypto projects have this goal as well with Floki recently launching TokenFi to capture a portion of the tokenization market as well.
Great Call for HSBC
Tapping Metaco for this service is a great call for HSBC judging by the ease with which the firm can gain access to Ripple’s expertise to bolster its role as demanded.
The crypto custody services will complement the push of HSBC in the crypto world. The bank ranks as one of the first to embrace the concept of the metaverse when it inked a partnership with The Sandbox back in March last year.
Away from custodial services, HSBC expanded its accepted payment methods for its customers recently. As reported by The Crypto Basic, the bank’s customers could pay for their mortgage bills through Shiba Inu and XRP via the FCPay Gateway as early as September.