diff --git a/runtime/kusama/src/lib.rs b/runtime/kusama/src/lib.rs
index fe41607dda43..aafa9647d66b 100644
--- a/runtime/kusama/src/lib.rs
+++ b/runtime/kusama/src/lib.rs
@@ -60,7 +60,7 @@ use xcm_builder::{
 	AccountId32Aliases, ChildParachainConvertsVia, SovereignSignedViaLocation, CurrencyAdapter as XcmCurrencyAdapter,
 	ChildParachainAsNative, SignedAccountId32AsNative, ChildSystemParachainAsSuperuser, LocationInverter,
 	IsConcrete, FixedWeightBounds, TakeWeightCredit, AllowTopLevelPaidExecutionFrom, AllowUnpaidExecutionFrom,
-	IsChildSystemParachain, UsingComponents, BackingToPlurality, SignedToAccountId32,
+	IsChildSystemParachain, UsingComponents, BackingToPlurality, SignedToAccountId32, DerivedParachainAccountId32,
 };
 use xcm_executor::XcmExecutor;
 use sp_arithmetic::Perquintill;
@@ -1222,6 +1222,8 @@ pub type SovereignAccountOf = (
 	ChildParachainConvertsVia<ParaId, AccountId>,
 	// We can directly alias an `AccountId32` into a local account.
 	AccountId32Aliases<KusamaNetwork, AccountId>,
+	// We can generate local account ids for accounts originating on parachains.
+	DerivedParachainAccountId32<KusamaNetwork, AccountId>,
 );
 
 /// Our asset transactor. This is what allows us to interest with the runtime facilities from the point of
diff --git a/runtime/rococo/src/lib.rs b/runtime/rococo/src/lib.rs
index 04c7adc96f55..374438e9a3a0 100644
--- a/runtime/rococo/src/lib.rs
+++ b/runtime/rococo/src/lib.rs
@@ -94,7 +94,7 @@ use xcm_builder::{
 	AccountId32Aliases, ChildParachainConvertsVia, SovereignSignedViaLocation,
 	CurrencyAdapter as XcmCurrencyAdapter, ChildParachainAsNative, SignedAccountId32AsNative,
 	ChildSystemParachainAsSuperuser, LocationInverter, IsConcrete, FixedWeightBounds,
-	BackingToPlurality, SignedToAccountId32, UsingComponents,
+	BackingToPlurality, SignedToAccountId32, UsingComponents, DerivedParachainAccountId32,
 };
 use constants::{time::*, currency::*, fee::*};
 use frame_support::traits::InstanceFilter;
@@ -608,6 +608,8 @@ parameter_types! {
 pub type SovereignAccountOf = (
 	ChildParachainConvertsVia<ParaId, AccountId>,
 	AccountId32Aliases<RococoNetwork, AccountId>,
+	// We can generate local account ids for accounts originating on parachains.
+	DerivedParachainAccountId32<RococoNetwork, AccountId>,
 );
 
 pub type LocalAssetTransactor =
diff --git a/runtime/westend/src/lib.rs b/runtime/westend/src/lib.rs
index 0ee78b5d19c4..964b386d2c16 100644
--- a/runtime/westend/src/lib.rs
+++ b/runtime/westend/src/lib.rs
@@ -61,7 +61,7 @@ use xcm_builder::{
 	AccountId32Aliases, ChildParachainConvertsVia, SovereignSignedViaLocation, CurrencyAdapter as XcmCurrencyAdapter,
 	ChildParachainAsNative, SignedAccountId32AsNative, ChildSystemParachainAsSuperuser, LocationInverter, IsConcrete,
 	FixedWeightBounds, TakeWeightCredit, AllowTopLevelPaidExecutionFrom, AllowUnpaidExecutionFrom,
-	IsChildSystemParachain, UsingComponents, SignedToAccountId32,
+	IsChildSystemParachain, UsingComponents, SignedToAccountId32, DerivedParachainAccountId32,
 };
 
 use sp_runtime::{
@@ -880,6 +880,8 @@ parameter_types! {
 pub type LocationConverter = (
 	ChildParachainConvertsVia<ParaId, AccountId>,
 	AccountId32Aliases<WestendNetwork, AccountId>,
+	// We can generate local account ids for accounts originating on parachains.
+	DerivedParachainAccountId32<WestendNetwork, AccountId>,
 );
 
 pub type LocalAssetTransactor =
diff --git a/xcm/xcm-builder/src/lib.rs b/xcm/xcm-builder/src/lib.rs
index 534261a9998d..6dc43042c79a 100644
--- a/xcm/xcm-builder/src/lib.rs
+++ b/xcm/xcm-builder/src/lib.rs
@@ -28,7 +28,7 @@ mod tests;
 mod location_conversion;
 pub use location_conversion::{
 	Account32Hash, ParentIsDefault, ChildParachainConvertsVia, SiblingParachainConvertsVia, AccountId32Aliases,
-	AccountKey20Aliases, LocationInverter,
+	AccountKey20Aliases, LocationInverter, DerivedParachainAccountId32,
 };
 
 mod origin_conversion;
diff --git a/xcm/xcm-builder/src/location_conversion.rs b/xcm/xcm-builder/src/location_conversion.rs
index cdf0a2bf5171..80cf0eaf8aae 100644
--- a/xcm/xcm-builder/src/location_conversion.rs
+++ b/xcm/xcm-builder/src/location_conversion.rs
@@ -123,6 +123,7 @@ impl<
 	}
 }
 
+/// Extracts the `AccountKey20` from the passed `location` if the network matches.
 pub struct AccountKey20Aliases<Network, AccountId>(PhantomData<(Network, AccountId)>);
 impl<
 	Network: Get<NetworkId>,
@@ -143,6 +144,41 @@ impl<
 	}
 }
 
+/// Generates a unique `AccountId` for a given parachain + account combination.
+///
+/// Used for giving parachains control over some accounts on the interpreting chain.
+///
+/// Note: Not reversible.
+pub struct DerivedParachainAccountId32<Network, AccountId>(PhantomData<(Network, AccountId)>);
+impl<
+	Network: Get<NetworkId>,
+	AccountId: From<[u8; 32]> + Into<[u8; 32]> + Clone,
+> Convert<MultiLocation, AccountId> for DerivedParachainAccountId32<Network, AccountId> {
+	fn convert(location: MultiLocation) -> Result<AccountId, MultiLocation> {
+		use Junction::*;
+		use MultiLocation::*;
+		let id = match location {
+			X2(Parachain(para_id), AccountId32 { id, network })
+				if network == NetworkId::Any || &network == &Network::get() =>
+			{
+				(para_id, id).using_encoded(blake2_256)
+			},
+			X2(Parachain(para_id), AccountKey20 { key, network })
+				if network == NetworkId::Any || &network == &Network::get() =>
+			{
+				(para_id, key).using_encoded(blake2_256)
+			},
+			l => return Err(l),
+		};
+		Ok(id.into())
+	}
+
+	// reverse conversion is not implemented
+	fn reverse(who: AccountId) -> Result<MultiLocation, AccountId> {
+		Err(who)
+	}
+}
+
 /// Simple location inverter; give it this location's ancestry and it'll figure out the inverted
 /// location.
 ///