HSBC joins Singapore Exchange and Temasek to issue blockchain-based fixed income securities

According to Cointelegraph's recent report, the global banking giant HSBC will work with the Singapore Exchange and Temasek Investment Corporation to jointly use the blockchain to issue fixed income securities.


(Source: HSBC )

On November 13, HSBC Singapore announced that the pilot was selected in the Asian bond market to simplify the bond issuance process and reduce associated costs through tokenized securities and smart contracts.

HSBC said that despite the continued growth of the Asian fixed income market, bond issuance and service processes remain inefficient. It is said that this is because there has not been a single platform for information exchange and tracking between multiple parties throughout the life of the bond.

Smart contract joint test

To this end, the new trial will use tokenized securities and smart contracts (blockchain-based multiparty implementation agreements) to facilitate interaction between investors, bond issuers and custodians.

Lee Beng Hong, head of the fixed-income division of the Singapore Exchange, pointed out that the addition of HSBC and Temasek will help companies assess whether smart contracts and distributed ledger technology can solve some of the problems in the fixed-income market. HSBC Singapore CEO Tony Cripps said:

The distributed ledger technology is constantly evolving, and it remains to be seen whether it can improve the inefficiency of the fixed-income market. Only by working with market participants can we fully understand its practical feasibility. We hope to explore whether digital assets can become a reality by working with the Singapore Exchange and Temasek.

It is reported that HSBC, Singapore Exchange and Temasek are already testing blockchain technology.

On November 11, Temasek and the Singapore Central Bank launched a single-network multi-currency payment prototype network based on blockchain technology, which was jointly developed with JP Morgan Chase. In October, HSBC successfully applied for a blockchain-based letter of credit in Malaysia. In November 2018, the Singapore Exchange cooperated with the country's Monetary Authority to successfully pilot the blockchain test for the settlement of tokenized assets.