HSBC is planning to shift $20 billion worth of assets to a new blockchain-based custody platform called Digital Vault by March of next year.

According to Reuters report, by using blockchain technology, the new platform will digitise paper-based records of private placements, reducing the time it takes investors to make checks or queries on holdings. Particularly, it is supposed that the platform will provide investors track securities bought on private markets in real-time.

HSBC is expecting that the private placements’ global volumes will reach $7.7 trillion within three years, setting a 60% growth from 5 years earlier. During the same timeframe, bank predicts from 9% to 20% growth in the allocations by asset manager clients.

However, it’s said that it’s not evident how radical the project will be. As Reuters states, HSBC couldn’t measure the amount the bank or its clients will be able to save by using the platform.

According to Ciaran Roddy, head of custody innovation at HSBC’s securities services arm, mentioned that the United States, British, Asian and Middle Eastern insurers get interested in private placements more and more. He noted: “With some of the yields that are on offer, we are definitely seeing an increase in demand.”

 

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