Citigroup has launched Citi Token Services, a permissioned private blockchain that provides cross-border payments, liquidity and automated trade finance solutions to institutional clients. According to one person, the new service “will integrate tokenized deposits and smart contracts into Citi’s global network.” statement.
Citi Treasury and Trade Solutions (TTS) holds banking licenses in more than 90 countries and has completed two service pilots. It has partnered with Danish shipping company Maersk and an unnamed canal authority on a program to make instant payments to service providers through smart contracts, reducing transaction processing time from days to minutes. The service replaces bank guarantees and letters of credit, the statement said.
Ryan Rugg, global head of digital assets at TTS, said the second pilot program enables clients to transfer liquidity between Citi branches around the clock, reducing “friction associated with cutoff times and gaps in service windows.” He continued:
“Our solutions across the Citi network are complemented by inclusive and open industry collaboration on initiatives such as the Regulatory Accountability Network.”
Regulatory Accountability Network (RLN) Technology introduce November 2022. Citigroup was one of the large financial institutions participating in a proof-of-concept led by the New York Fed that ended in July.
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The RLN infrastructure places assets and liabilities on the same ledger to provide atomic settlement. It’s one of a handful of “unified ledger” proposals that have emerged in recent months. The new Citi service uses deposit tokens, which are tokenized commercial bank funds.
In light of the Citi Token Service announcement, don’t forget they are building a separate protocol to circumvent #bitcoin, called the regulatory responsibility network. From the RLN website: pic.twitter.com/2dUYJX4zK0
— Cameron Otsuka (@CameronOtsuka) September 18, 2023
JPMorgan is also reportedly exploring the use of deposit tokens. The technology is the first of its kind under Project Guardian launched by the Monetary Authority of Singapore in May 2022, with JPMorgan also participating.
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