Digital Development Global Research Report | The Function and Significance of HSBC Hong Kong Tokenized Deposits

Digital Development Global Research Report Volume 3 Issue 21 (2025/5/19-2025/5/25)

This issue introduces the blockchain settlement-related services launched by HSBC Hong Kong based on public information for reference.

On May 22, 2025, HSBC launched the first corporate treasury management solution based on tokenized deposits provided by a bank in Hong Kong, which is a local blockchain settlement service. HSBC plans to promote it to the Asian and European markets in the second half of this year, and it is currently only available in Hong Kong.

1. Service Background and Launch Status

In recent years, the application of blockchain technology in the financial field has been continuously explored and expanded, and tokenization, as an emerging form of digital assets, has gradually attracted attention. In line with this trend, HSBC launched a tokenized deposit service in Hong Kong, aiming to provide enterprises with more efficient and convenient fund management and payment settlement solutions to enhance their competitiveness in the digital economy era.

The launch of this service also benefited from the Hong Kong Monetary Authority's active support and promotion of financial technology, as well as Hong Kong's good environment and infrastructure for financial innovation as an international financial center.

II. Service Principles and Functions

HSBC's tokenized deposits are based on blockchain technology, converting the company's Hong Kong dollar or US dollar deposits into digital tokens that can be traded on the blockchain. These tokens represent the company's actual deposits in HSBC Bank and have the same asset value and rights as traditional deposits.

These tokens can be transferred and paid in real time between wallets held by different companies under the company's name, and are not restricted by traditional factors such as time and space, achieving 7×24 hours of all-weather operation, greatly improving the liquidity and management efficiency of corporate funds.

III. Service Advantages

Improve fund management efficiency.Enterprises can allocate funds more quickly and realize instant transfer of funds between different accounts, which reduces the time of funds in transit, improves the efficiency of fund use, and helps enterprises better grasp investment and business opportunities.

Enhance the flexibility and convenience of payment and settlement.Through tokenized transactions on the blockchain, enterprises can break through the time and geographical restrictions of traditional payment systems and make payments and settlements anytime and anywhere, which is especially suitable for enterprises with frequent cross-border business and can effectively reduce the cost and complexity of cross-border payments.

Improve transaction transparency and security. The distributed ledger feature of blockchain technology enables all transaction records to be recorded on the chain in a complete and unalterable manner. Enterprises can query and trace the flow of funds at any time, which enhances the transparency and auditability of transactions. At the same time, the encryption technology and consensus mechanism of blockchain also provide higher security for transactions and reduce the risk of data leakage and fraud.

Supports integration with other digital assets and blockchain applications. As a form of digital assets, tokenized deposits can easily interact and integrate with other digital assets and blockchain-based financial applications, creating more innovative business models and value growth opportunities for enterprises. For example, enterprises can combine tokenized deposits with other digital financial products to achieve diversified asset allocation; or participate in application scenarios such as supply chain finance and cross-border trade financing based on blockchain to expand business boundaries.

IV. Application Scenarios and Cases

Internal fund transfers within enterprises.Enterprise groups can use HSBC's tokenized deposit service to quickly and efficiently transfer funds between its different subsidiaries or branches, and realize centralized management and optimal allocation of funds. For example, a multinational enterprise group can open a tokenized deposit account at HSBC Bank in Hong Kong, and then use the blockchain network to collect or transfer funds from its subsidiaries in different countries and regions in real time, thereby improving the efficiency and effectiveness of fund use.

Cross-border trade settlement.In cross-border trade, import and export companies can use tokenized deposits to pay and settle goods, thereby speeding up transactions and reducing settlement risks. When a cross-border transaction is concluded, the buyer company can transfer the corresponding amount of tokenized deposits to the seller company. The two parties can confirm the receipt and payment of funds in real time, without relying on traditional settlement methods such as bank wire transfers, which greatly shortens the transaction cycle.

Ant International Case. Ant International became the first corporate customer in Hong Kong to adopt HSBC's new tokenized deposit service. It completed the first internal fund transfer of the group by converting US dollar deposits into digital tokens on HSBC's distributed ledger system. This marks an important step for Hong Kong in promoting the integration of blockchain and traditional finance, and also demonstrates the application value and potential of this service in actual corporate operations.

5. Similar services of banks in other regions

By May 2025, in addition to HSBC, the following banks around the world have launched similar tokenized deposit services or have related plans:

Under the coordination of the Swiss Banking Association,UBS, Julius Baerand other twelve banks have introduced projects to tokenize the Swiss franc.

Citibanklaunched "Citi Token Services" in April 2025 to provide tokenized deposits and smart contract services to institutional clients, which has been used to demonstrate a digital solution with the same purpose as bank guarantees and letters of credit.Wells Fargo Bank, JPMorgan Chase Bankand others are also actively exploring the application of tokenized deposits. After running the JPM Coin system in 2019, JPMorgan Chase Bank is now exploring the use of tokenized deposits to accelerate cross-border payments and settlements.

South Korea'sHana Bank and Woori Bankare studying tokenized deposit-related businesses.

In April 2025, the European Commission passed the "eMarket Infrastructures Act", requiring that from 2026, the EU systemically important payment system (SIPS) will gradually replace the existing settlement currency in the large payment system with central bank digital currency (CBDC) and tokenized deposits, Bank of France, German Federal Bankand other European central banks will build a financial ecosystem based on CBDC and tokenized deposits of commercial banks.

Sixth, the impact and significance on the financial industry

Promote banking business innovation. HSBC's tokenized deposit service provides banks with a new business model and customer service means, which helps banks expand their business areas, increase market share and competitiveness. At the same time, it also prompts other banks to accelerate the research and exploration of blockchain technology and tokenized business, and promote the digital transformation and innovative development of the entire banking industry.

Promote the deep integration of finance and technology. The successful launch of this service is the result of close cooperation between financial institutions and technology companies, reflecting the deep application and value creation of blockchain technology in the traditional financial field. In the future, with the continuous advancement and improvement of technology, the integration of finance and technology will be more in-depth, bringing more innovative products and services to the financial industry to meet the increasingly diversified and personalized needs of customers.

Explore the regulatory framework for digital currency and financial technology. The emergence of tokenized deposit services has also brought new challenges and issues to financial supervision, prompting regulators to strengthen regulatory research and policy formulation on digital currencies, blockchain technology and related financial innovations, and explore the establishment of a regulatory framework and rules system that adapts to the development of financial technology to ensure the stability of the financial market and the legitimate rights and interests of consumers. (The pictures in the article are generated by Doubao)