Citigroup To Launch Private Blockchain Pilot for Institutional Clients
The pilot program uses a private blockchain owned and managed by Citi.
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Citigroup Inc. announced today the launch of a new pilot program, Citi Token Services, that will allow institutional clients to use blockchain technology and smart contracts for cross-border payments and trade finance transactions.
The new service will give Citi’s institutional customers access to the bank’s private blockchain network from their existing accounts without needing to create a new digital wallet or operate blockchain nodes.
“The development of Citi Token Services is part of our journey to deliver real-time, always-on, next-generation transaction banking services to our institutional clients,” said Citi Global Head of Services Shahmir Khaliq
Through Citi Token Services, clients will be able to make instant, 24/7 cross-border transfers between Citi branches using blockchain rails.
“Frictions related to cut-off times and gaps in the service window will be reduced,” said Ryan Rugg, Global Head of Digital Assets at Citi Treasury and Trade Solutions.
Collaborating with Maersk, a major leader in global shipping, Citi has tested using smart contracts to replace traditional trade finance tools like letters of credit and bank guarantees, which have traditionally been used to secure transactions for both buyers and sellers.
“The innovative solution has promising applications for trade finance,” said Marie-Laure Martin, Regional Treasury Manager at Maersk.
Citi’s blockchain pilot comes just months after it participated along with the New York Fed and other banks in a successful test of blockchain-based cross-border payments dubbed the Regulated Liability Network.
The banking giant serves 200 million customers in more than 160 countries, including public sector organizations, multinational corporations, and financial institutions.