Banking giant HSBC is replacing paper records with a blockchain-based platform to track $10 billion in private investments. Bank clients can use the platform, dubbed the “Digital Vault”, to access digitized records of securities that were purchased on private markets.
The platform reduces the time it takes for clients to check, search or verify transactions in real time, instead of needing to contact the bank for access to information on their holdings.
The upgrade from paper records to the Digital Vault comes as HSBC expects the value of the private placement market to soar to $7.7 trillion in two years, representing a 60% surge since 2017.
Ciaran Roddy, head of custody innovation at HSBC’s securities services arm, says that interest in private placements from sovereign funds across the world is on the up and up.
“With some of the yields that are on offer, we are definitely seeing an increase in demand.”
The Digital Vault is based on R3’s enterprise-grade, open-source blockchain platform Corda.
HSBC plans to shift another $10 billion in private placements to its digitized blockchain-based records, for a total of $20 billion.