HSBC’s New Securities Blockchain Will Control $20B

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HSBC will upgrade their blockchain technology to control $20 billion in assets by March 2020. Digital Vault, the blockchain HSBC announced today, will control assets referred to as “private placements”, which are securities bought on private markets. Digital Vault will use distributed ledger technology to “give investors real-time access to their records”.

[Originally published in LinkedIn]

In January HSBC disclosed that its blockchain platform FX Everywhere has settled 3 million foreign exchange (FX) transactions, and made a further 150,000 payments. FX Everywhere ensured consistency between the bank’s balance sheets. HSBC used blockchain to verify that payments are settled without needing external confirmation; to unify intra-company trade data on a “shared, single version of the truth”; and to consolidate its view of cash flows. The bank reported improvement of efficiency in addition to these goals.

Digital Vault will take over $20 billion worth of securities, which is 40% (ie $50 billion) of HSBC assets in private placements, a significant step from a major bank.

Unfortunately HSBC did not release any details nor answered questions about the implementation of its new blockchain. It is unclear whether Digital Vault uses open source (or a fork) or proprietary software.

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