Blockchain: special focus
Euromoney's latest coverage of the distributed ledger technology.
The Chinese bank is making a big push in areas such as financial inclusion as it targets sustainable ways to build its business and support the Chinese economy.
Swift hopes its know your customer (KYC) registry, now open to corporate partners, will succeed in ways in which others have failed, given the institution's not-for profit and cooperative position.
Singapore-based trade finance portal CamelOne has put blockchain on the backburner to get to market more quickly.
The SoFi co-founder’s second act involves eliminating ‘rent seekers’ from the capital markets. Securitizing blockchain-originated loans will go some way towards demonstrating if it can be done.
Consolidation in payments is inevitable, but while some believe that only those with state-of-the-art technology – such as blockchain – will reign victorious, that’s not the case.
Driven by changes in technology and many new entrants to the business, transaction banking is no longer a boring, old, but stable revenue earner, chugging along in the background. Instead, trade finance and cash management are becoming an exciting and critical area of banking.
This Chinese financial institution should be on everyone's digital radar, not just for being one of the world's largest unicorms, but for also trying 'to make the world flatter' – via tech.
This financial institution was the first in the country to put its money where its mouth was regarding a digital transformation – making it one to watch as it brands itself a disruptor too.
A lack of regulation and standardization creates opportunities for businesses that can create a one-stop shop for all blockchain trade finance needs. So who is doing it?
Blockchain has the potential to revolutionize trade finance, but a lack of standardization will hinder its adoption.
There has been a distinct shift towards collaboration rather than competition as new distributed ledger technology platforms continue to emerge and more established platforms extend their reach.
Taking blockchain proof of concepts into production is a slow process, but a new loan-servicing platform shows how banks could cut costs and improve service.
JPMorgan announced that it will be the first American bank to launch its own digital currency, but what to other bankers think of it?.
JPMorgan says that its new dollar stablecoins are collateralized against client dollar deposits but it also emphasizes its own strong balance sheet as surety.
Having tested HSBC FX Everywhere on internal payments, the bank now aims to provide it as a platform service to clients.
After much talk and little action, the use of blockchain in trade finance is picking up, and Asia-Pacific is at the heart of that change – but despite progress, the many different consortia need to agree on some common ground to get things moving.
CLSNet – a new payments netting service for FX trades – aims to reduce costs and increase liquidity for market participants.
Under-investment in post-trade infrastructure is driving interest in distributed ledger technology as a means of reducing back-office costs.
Banks and traders tout efficiency and the trust benefits of a new fintech platform, but key absentees mitigate the hoped-for 'network effect'.
Eight banks have gone live with the Voltron initiative, an open platform for documentary trade.
Why blockchain is not the only answer for transaction banking.
Argo offers state of-the-art crypto mining as a service to the little guy but COTI’s trustchain may do away with miners altogether.
With 75 banks signed up in late September, IIN is already approaching 100 banks convinced that blockchain is the best, safest and quickest way to resolve blocked cross-border payments.
The world of cross-border payments in undergoing a digital transformation, which is set to eradicate long delays, friction and high transaction costs.
For decades, Union Bank of the Philippines has been a worthy medium-sized lender, but little more. Now, it has shaken off its shackles and is investing heavily in technology, with a view to supplanting DBS as the best digital bank in Asia. Can it succeed?
The insurance firm has armed itself to the teeth with fintech, but can it really take on internet champions such as Alibaba and Tencent?
New efforts to execute equity transactions on blockchain are emerging, for now concentrated in private equity, as disruptors seek to build investor and regulatory confidence in security tokens.
With a modest-sized two-year Aussie dollar transaction, the World Bank may have ushered in a new era of speed, efficiency and transparency in debt capital markets, with deals announced, order books built and bonds priced and allocated on blockchain.
Banks were once sceptical about blockchain technology, but now – having recognised it as an existential threat to their businesses – they are leading the way in its development and implementation.
Those behind blockchain-based trade finance platform we.trade, which completed its first round of transactions this month, have acknowledged that banks will have to support multiple platforms to offer a rounded digital trade service.
Private equity house takes stake in UK payments processor.
Distributed ledger technology could be answer to GDPR for banks worried their legacy systems will struggle to cope with customer rights over their records.
A soybean trade between two arms of Cargill using letters of credit from HSBC and ING shows the R3 Corda platform is finally set to scale up.
Banks are proving so slow to collaborate on blockchain protocols that could reduce costs in financial markets that it almost looks as if they wish to profit from persistent inefficiency.
IHS Markit has recently announced it is to collaborate with Cambridge Blockchain to look into ways to take the information on its database onto the distributed ledger (DL).
The luxury-asset investment platform is to raise funds by selling tokens that mirror participation certificates under Swiss law, with full KYC and AML checks on buyers.
Primary debt capital markets have been remarkably slow to embrace technology. Vested interests are at play: lucrative underwriting fees will not be wrested from the banks without a fight. But automation is coming, partly driven by regulators looking into dysfunctional allocation.
Forget the impression that China’s banks are out-dated and too traditional – they are rapidly embracing the importance of technology and often partnering with the country’s disruptors to modernize their products, services and business performance. Here are the leaders in Chinese fintech.
Marco Abele, former head of digital for private banking at Credit Suisse, plans to tokenize billionaires’ luxury assets so millionaires can enjoy them too.
Although banks like talking about bringing digital services to trade finance, a surprisingly low proportion of the 7,000-plus participants in Euromoney’s annual trade finance survey are actually using the technology.
Financial providers are pushing to identify new higher-margin services, while remaining relevant to corporate partners and boosting profitability in a disruptive digital age. Meanwhile, across the Middle East economies, governments want to diversify away from oil and gas, creating opportunities for multinationals, regional banks and export credit agencies.
LBBW needs to invest in technology, learn from fintech and even look at what blockchain could mean to its clients.
I realize my mistake within minutes of sharing with a colleague the notice from Dentacoin of the first blockchain solution for the global dental industry, including its own cryptocurrency token to pay for dental care products on a new trading platform.
Tearing out the old plumbing of the global payments system and switching to distributed ledger is an enormous and potentially risky transition that could take a decade or more, but there may be an easier way to capture efficiency.
Delegates at this year’s IMF/World Bank meetings are managing to look beyond macro concerns to present a more upbeat tone.
Corporate treasurers are putting forward the case for using blockchain in their daily operations, weighing the benefits and potential drawbacks.
Trade finance has long been in need of a move way from paper documentation. With a number of digital solutions based around distributed ledger technology (DLT) in development the foundations look to be in place.
After breakthrough proofs of concept in the spring, two large projects are now quietly moving forward into pilot production that could see blockchain technology transform wholesale markets at the core of the global financial system.
For years, much of the hype in payments has been around mobile payments and blockchain technology. But the innovation that has done the most to change British shopping habits has been contactless cards, which launched in 2007 but have really come of age in recent years.
Despite the progress of other projects applying blockchain technology to FX, Cobalt’s CEO remains confident that his post-trade processing network can reach critical mass.
Ripple has come to be the dominant name for payments in the distributed ledger (DL) space, thanks largely to the decision to consolidate its efforts.
As well as helping traders manage risk, CLSNet will be of interest to many institutions as a way of getting some hands-on experience in using distributed ledger technology (DLT).
Pilot projects to transact on distributed ledgers are starting to deliver lower costs, higher speeds and improved efficiency to bank customers. Blockchain may be the biggest shake up in market share the banking business has ever seen.
E-commerce needs a strategic rethink in how payments are collected to increase efficiency and reduce clearing times. PSD2 is one possible resolution, with social media also starting to play a role.
Robert Palatnick of the DTCC says that with so much activity occurring across the industry, it is critical that all parties place standards at the heart of their DLT initiatives.
The Financial Conduct Authority’s (FCA) regulatory sandbox has been a hit with market participants and regulators alike, giving firms whose services were never anticipated by existing rules the chance to test out new features without fear of fines or enforcement action. As the regulator sifts through applications for the second phase of the programme, some of the FX and blockchain-related firms from the first cohort outline here the value of the regulatory insight gained from their participation.
Some of Europe’s biggest banks have joined behind KBC’s blockchain prototype to help SMEs increase trade across the continent.
Treasurers are looking for digitized trade finance solutions; blockchain may be the answer.
Taking post-trade processing onto distributed ledger could be the first big step, with clearing and settlement and even payments to follow.
The Fed’s white paper on blockchain shows the extent of concerns about instability in the $12.6 trillion-a-day US payments system as it adapts to new technology. It also puts tech providers on warning of bank-like regulation.
While accepting that regulation can help increase consumer and business confidence in cryptocurrencies, providers and industry analysts agree that the BitLicense model is not the way forward for the UK.
Some big things are going to happen on blockchain in the years ahead – and lots of little things as well that in aggregate might have a big effect on how the capital markets operate and how issuers raise funding
First international test; regs and compliance must catch up.
As Applied Blockchain and Tallysticks progress with their invoices-on-blockchain project, the prospect of a new form of short-term capital markets funding for companies emerges.
The days of using gold for everyday transactions have long since passed, but could the blockchain change that?
Sponsored – September, 2016
While banks are still unsure of how the blockchain will affect their businesses, there is a widely held feeling that it has transformational potential. But it is still early days for the technology, and a lot more work must be done developing the blockchain before it will be clear how it can improve the banking industry. Cobalt DL tests solution for blockchainization of FX trade settlement
Passengers have Uber, tourists have Airbnb, now Cobalt DL is beta testing the solution that aims to bring the benefits of the shared economy to FX trade settlement.
Everything you thought you knew about blockchain is wrong. Rather than wait for the blockchain to re-engineer banking, the banks are going to re-engineer the blockchain. It will not be public, it will be private. And across the shared ledger there will not be that much sharing. In an atmosphere somewhere between excitement and paranoia, banks are trying to turn an existential threat into a competitive advantage.
Banks’ experimentation with blockchain, or distributed ledger technology, is gathering pace in a fevered atmosphere.
Treasurers have much to gain from the integration of decentralized ledger technology into traditional accounting environments.
Banks are taking tentative steps to integrating blockchain technology, but so far they have focused on following established payment processes.
The Euromoney Blockchain Forum is the only event dedicated to the development and implementation of blockchain applications in financial services.
Starting by transforming the workflows around invoices, Applied Blockchain is developing practical uses for shared ledger technology on private networks.
After a record year for fund raising, large fintech companies are now emerging in marketplace lending and payments, with many more newcomers deploying venture capital money raised in $25 million to $50 million chunks to transform capital markets and traditional banking mainstays such as mortgage lending. The fintech start-ups are building revolutionary applications for blockchain, attacking every specialist niche in the financial world and keeping the image of fintech clean with business ventures aimed at inclusion.
Blockchain moves from hullabaloo to hard graft December 2015 In the second half of 2015 hype around the potential for shared ledger technology to transform banking rose to a peak. Now comes the hard work as banks and fintech companies seek to put test cases into actual use. As the first practical applications begin to emerge, Euromoney surveys the banking market to ask what’s next for the blockchain.
Rival blockchain services test corporate appetite November 2015 Interoperability rather than exclusivity appears to be the likely path to success for corporate blockchain services.
Banks have suddenly cottoned on to the power of the blockchain technology beneath Bitcoin. Inside their own treasuries and innovation labs, and increasingly in collaboration, banks are testing uses for rebranded distributed ledgers to replace their costly, proprietary systems.
Enthusiasts see banks creating a new fabric for payments transfer and financial markets, an internet of money. Doubters sense it’s all hype. Big challenges remain, but markets from private equity and syndicated loans to corporate bonds and derivatives may go on private blockchains within months.
Banks are suddenly obsessed with potential of the distributed ledger in financial markets, but regulators must make sure it is used in ways that remove collusion and wrongdoing.
Bitcoin is riding high after a recent European Court of Justice ruling that users in Europe are not liable to pay value-added tax when trading the cryptocurrency. But regulators worldwide are divided on whether it is a commodity or a currency and are still probing the advent of bitcoin derivatives as exchanges flourish to satisfy traders' demand for a wider range of products.
The number of countries with real-time payment systems continues to rise, raising the importance of addressing issues such as fraud detection and prevention, and collaboration.
Negative publicity around cryptocurrencies such as Bitcoin has deflected attention from the potential of the underlying technology to facilitate real-time – and therefore much cheaper – international payments.
Interest and use of cryptocurrency bitcoin has undergone a meteoric rise in the past year, but it is now moving away from speculative investments into the real world of cross-border business transactions.
The CureCoin Forum has teamed up with Stanford University to launch a new ethical cryptocurrency that aims to find cures for common, life-threatening illnesses, such as cancer and Alzheimer’s, by bringing together science and the craze for cryptocurrencies.