HSBC has launched its tokenized gold Hong Kong. This makes it the first bank which has successfully created a blockchain powered RWA or real world asset and made it available to its retail investors.
Where is the tokenized Gold by HSBC?
- It is digitized gold that is accessible via both the HK mobile bank and via online banking of HSBC
- The minting of the gold token from HSBC is done on the Orion digital platform of the HSBC bank.
What does HSBC the tokenized gold mean for you?
Retail clients of HSBC in the territory of Hong Kong would be able to buy digital gold with ease using this service from the bank.
A retail client of the bank has the opportunity to own a piece of the world's most sought after asset by market cap right from the comfort of app banking or online banking
Tokenized Gold is easier to buy and hold
Gold is certainly an asset that is a much sought after asset. Suppose you have the money to buy an endless amount of gold and you end up buying a few kilograms of gold.
First you have to go to a place where when you can buy that much go for this you would go to a physical market or place an order. Once you have the possession of the physical gold you would need some kind of storage space that is both accessible to you and is physically secure so that no one steals or robs you of the gold.
No doubt owning physical gold is buying into the world's number one asset class by market cap.
Owing this gold in digital format added a couple interesting options.
If we take the case of digitized gold from HSBC then the token is backed physical gold that would be stored in a vault in London.
This means you do not have to be responsible for the physical security of the gold yourself.
The digital gold would remain secure in your wallet account kept secure by your password and the built in security features.
This also implies you can technically carry your gold with you as you have access to your app or bank account from anywhere in the world.
Yet it is under a centralized control
Fans of decentralization would say that you do not have physical control of your physical gold; however there is a 1:1 mapping of the tokenized gold to physical gold.
Currently this asset can be owned and traded by only those in HongKong so this can be a dampeners for those outside this jurisdiction.
What this means for other RWA assets
Gold is a top notch number one asset in terms of market cap. If gold can be tokenized then the same can be done for other real world assets and this move would certainly set the precedent for other assets being tokenized and mapped onto the blockchain.
The flow of funds would be hard to stop
The charm of owning gold is undeniable. Be it for store of value, as a hedge against inflation or as an investment for the future different people have different reasons to own and trade this asset so its value as an asset is undeniable.
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