HSBC has announced completion of a major inroad in its use of tokenized technology, trialling the first application of quantum-secure technology for buying and selling tokenized physical gold.
The development marks a significant stepover between the traditional realms of physical currency and value and the modern, digitised technologies which have come to the forefront of finance and payments in recent years.
Quantum computing and tokenization have become keen areas of interest for HSBC over the past few years. Gold has been one of the main commodities targeted for this, with the use of the HSBC Orion digital assets platform.
The firm was the first to offer tokenized physical gold to institutional investors using digital ledger technology (DLT) and later launched its HSBC Gold Token in Hong Kong, allowing fractional ownership of physical gold.
Philip Intallura, Global Head of Quantum Technologies, HSBC, said: “HSBC was the first international bank to offer tokenized physical gold and is now building on that innovation with cutting-edge cybersecurity protection for the future.
“This pilot successfully demonstrated the viability of deploying these advanced technologies for a real-world business environment.”
HSBC’s wider efforts in tokenization saw the firm work with Chinese international payments giant Ant Group to launch successful trials of tokensied deposits in intra-treasury group transactions. The firm leveraged Ant’s blockchain technology to do so.
Another company that has played a key role in this is Quantinuum, an integrated quantum computing company. The Colorado-based firm used its Quantum Origin randomness technology platform and PQC algorithms to protect HSBC Gold Tokens from a quantum computing attack and prevent “store now, decrypt-later” (SNDL) cyber incidents.
Ilyas Khan, Quantinuum founder and Chief Product Officer, said: “As long-time partners in exploring commercial quantum applications, HSBC and Quantinuum are together building the next generation of financial services featuring quantum-hardened defences harnessing the power of today’s quantum computers to safeguard sensitive data now and into the future.”
Tokenisation is one of several technologies taking the payments world by storm lately, alongside the likes of Artificial Intelligence and Open Banking. HSBC is far from the only firm to be eyeing up more use of tokenisation, with Mastercard and Standard Chartered amongst other prominent payments stakeholders..
