Global banking giants Wells Fargo and HSBC Bank have announced that they have partnered to use a blockchain solution to settle and settle their respective foreign exchange (forex) transactions.
According to Mark Jones, co-head of Wells Fargo macro division, this will be the first time the bank has used blockchain technology in foreign exchange settlements. It also made clear that the two banks would use a platform provided by payment company Baton Systems, using its proprietary distributed universal CORE, which aims to be a blockchain, friction-free settlement system. The announcement then said:
“The platform enables participants to effectively settle bilateral cross-border liabilities in multiple land and offshore currencies, combined with the added flexibility of enlarged settlement windows to enable PvP [Payment versus Payment] optimization of risk reduction opportunities “.
The catholic will begin working on the US dollar, the Canadian dollar, the British pound and the euro, with plans to add more currencies in the near future.
The new offering will be based on HSBC’s FX Everywhere platform, which has traded more than $ 3 million worth of more than $ 2.5 trillion in the past three years, according to the press release.
Mark Williamson, Global Head of FX Partnerships & Propositions at HSBC, further noted that the bank aims to be in a good position to trade in “new forms of regulated digital currencies, such as digital central bank (CBDC) currencies”.
As part of the implementation, Wells Fargo and HSBC will comply with the Baton Regulation, a regulatory framework designed to provide legal certainty about the final settlement.