The US financial system is considering the use of shared ledger technology for multi-asset transactions.
The project will involve a number of prominent financial institutions (FIs) managed by the Securities Industry and Financial Markets Association (SIFMA), including Visa, Mastercard, Citi and JP Morgan.
“In the current financial system, commercial bank money, wholesale central bank money, and securities such as U.S. Treasuries and investment grade bonds all exist in separate systems,” SIMFA said in a news release on Wednesday, May 8. Stated.
“Tokenization of these instruments has the potential to enable payments in a common regulated venue established under existing legal frameworks.”
To explore this possibility, financial institutions will explore the feasibility of shared ledger technology to settle tokenized commercial bank money, wholesale central bank money, and U.S. regulated payment networks. (RSN), the association added. Treasury bills and other tokenized assets.
Raj Damodaran, Executive Vice President of Blockchain at Mastercard, said: “As blockchain technology continues to mature, public and private organizations will need to work closely together to solve real-world problems and improve efficiency. It will be important to consider how blockchain can be applied to and digital assets, it said in a statement to PYMNTS.
“Applying shared ledger technology to dollar payments could open the door to a next-generation market infrastructure where programmable payments can occur seamlessly 24/7,” Damodaran added.
In other areas of blockchain, PYMNTS recently explored the technology through the lens of real-world asset tokenization (RWA).
“Tokenized RWA has the potential to increase asset liquidity, accessibility, and efficiency while enhancing transparency, security, and global reach,” the report said.
“Representing RWA on the blockchain changes the way asset ownership is recorded and enables new functionality.”
However, PYMNTS writes that tokenization of RWA has yet to take off in earnest, in part due to the lack of broadly interoperable infrastructure across the private and public payments sectors.
“The true intrinsic value of blockchain, such as transaction programmability, transaction immutability, delivery and payment, and the ability to make always-on type payments, remains to be discovered,” said Mastercard Chief Digital Officer. Joan Lambert told PYMNTS. last summer.
“Until we can actually develop financial regulated applications on blockchain, the benefits will never become mainstream,” Lambert said. “Regulated financial institutions are [tokenized blockchain money movement vehicles] To really scale. ”
