With a focus on Hong Kong's retail investors, giant bank, HSBC recently launched Gold Token. Customers of HSBC will be able to access the token via the bank's mobile app and online banking website.

The bank claims that this is the first retail offering from the company, introduced in response to the Chinese regulator's insistence on seeing digital assets made available to the general population.

As the name implies, actual gold backs the gold tokens. The bank's own Orion private blockchain will be used to verify the ownership of the tokens. This blockchain will also be used to mint the tokens.

"We acknowledge the rising demand for digital assets and the existing familiarity of our customers with gold investment," HSBC's general manager and head of wealth and personal banking in Hong Kong, Maggie Ng, stated in a release.

The HSBC Orion is a DLT-based bond tokenization platform that the company created and launched in 2022. The platform was created to improve bond issuance and trading's effectiveness, security, and adaptability.

Before this announcement, HSBC had hinted at a tokenized gold offering in association with Metaco, a cryptocurrency safekeeping expert owned by Ripple. The action fit into the bank's new custody strategy for digital assets.

Following the November circulars from the Hong Kong Securities and Futures Commission (SFC), the tokenized gold product has been introduced. Issuers were advised to launch tokenized investment products with SFC authorization in the two circulars. As per the circular, "The SFC believes that it is suitable to permit the principal dealing of tokenized SFC-authorised investment products, given that the underlying product fulfills all relevant product authorization requirements and has extra safeguards to mitigate the new risks linked to the tokenization arrangement."

According to the agency, tokenized goods can improve efficiency and transparency while also lowering operating expenses.

Real-world assets (RWA) are being added to blockchains by many banks and other traditional institutions that have recently expressed interest in entering the asset tokenization market. BlackRock is the most recent player in the decentralized market to capitalize on this trend, having just introduced its Institutional Digital Liquidity Fund for USD.