HSBC has reportedly put $10 billion of paper-based private placement records on R3’s Corda blockchain, an enterprise blockchain platform that delivers privacy, security, interoperability and scalability. The company officials are willing to extend additional volume and value of private placements from new and existing clients on the platform over the next 12 to 18 months. The company told they would put $20 billion on the platform but that effort has become slowed because of client interest. HSBC is focused on assets that have yet to be digitalized as well as exchange-based security tokens and traditional assets that could be fractionalized. The bank is reportedly seeing demand from clients to use tokens for a whole fund lifecycle, as well as tokens that are a basket of assets wrapped into one.
As per the intention of tokenizing the private placements after being digitalized, the bank is using blockchain as opposed to a traditional database. The cardinal aim of the bank with Corda is to get real-time information access. Claiming ‘’incremental internal efficiency,’’ the bank did not put a cost-savings estimate on the digital project. The first thing the bank has to get issuers on board with the idea and make sure the regulators are comfortable with recognizing tokens as legal, enforceable and transferable assets as tokenization would allow for the bank to implement tools like smart contracts.
Making it easy for clients
The bank is making the Corda platform in such a way so that clients can make easy access to it. They have stored all lists of particular transactions which can be brought with a click. They have enhanced an opportunity for their clients so that they can grant system access to third parties like regulators and auditors. Basically, the bank wants a world in which financial entities can turn to tokens as a better way of issuing assets. The bank wants to support clients who want to transact in token markets.