HSBC launches Hong Kong's first blockchain settlement service, cutting costs by 30% compared to traditional systems
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HSBC launches Hong Kong's first blockchain settlement service, cutting costs by 30% compared to traditional systems
HSBC said this payment method could be cheaper and faster compared to traditional systems.
Navigating Web3 tides with focused insightsAuthor: Bitcoinist
Translation: Blockchain Knight
HSBC has launched Hong Kong's first settlement service using blockchain technology. The service converts ordinary bank deposits into digital tokens, enabling businesses to transfer funds almost instantly.
According to Lewis Sun, HSBC's Global Head of Domestic and Emerging Payments within Global Payment Solutions, this payment method could be faster and cheaper compared to traditional systems.
HSBC's newly launched tokenized deposit program allows businesses to exchange ordinary deposits for tokens on a blockchain platform. Business funds remain on the bank's balance sheet, but they can send and receive these funds just like sending cryptocurrency.
Sun said this approach eliminates additional fees and delays, and enables tracking each payment on-chain, allowing companies to monitor fund flows in real time.
HSBC stated that the service operates around the clock. Corporate clients can transfer Hong Kong dollars and US dollars between HSBC Hong Kong wallets at any time.
This marks a significant shift from standard banking operations, where transfers are typically paused during nights or weekends. Real-time transfers mean treasurers can respond quickly to market fluctuations or urgent needs.
Ant International, a subsidiary of Alibaba Group, was the first client to test the system. HSBC said Ant International used its Whale platform to transfer funds instantly. After piloting in May, the bank incorporated the experience into its official service.
Kelvin Li, Technology General Manager at Ant International Platform, said tokenization serves as a bridge between traditional banking and blockchain. He added that the project aims to make financial operations more transparent and efficient.
HSBC's launch was supported by the Hong Kong Monetary Authority's Distributed Ledger Technology Regulatory Sandbox. HSBC is one of several banks conducting proof-of-concept trials under the HKMA's tokenization initiative.
In August, the Hong Kong Monetary Authority established a central bank digital currency testing mechanism. Six firms, including HSBC, began experimenting with tokenized currencies for digital asset transactions.
This move brings Hong Kong closer to interbank blockchain settlement. HSBC plans to expand its service to Asian and European markets in the second half of 2025.
The new system could transform how large enterprises manage cash. Companies no longer need to wait for bank opening hours or pay unexpected fees. Instant information on every payment enables clearer liquidity visibility throughout the day.
However, the project also faces challenges. Businesses must upgrade their back-end systems to interact with tokens. In addition, blockchain platforms must remain secure against intrusions or technical failures.
According to the latest ranking of Europe's top 50 lenders published by S&P Global Market Intelligence, HSBC is the largest bank in Europe by assets.
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