Mastercard, Visa, JPMorgan, CitiBank, and other major banks in America are conducting trials on a new blockchain ledger for asset tokenization.
Several large banks and financial institutions in America are currently testing a new blockchain ledger that has been developing since late 2022.
This trial marks the second phase, aiming to streamline transactions across these companies concerning various financial assets such as cash, bonds, and other investment assets in the form of debt issued by commercial or national banks.
New Blockchain Trial
Several major companies including Mastercard, Visa, JPMorgan, CitiBank, Swift, Wells Fargo, and BNY Mellon are reportedly continuing trials on blockchain integration initiated since 2022.
Previous trials took place at the end of 2022, lasting 12 weeks, testing integrated transactions to facilitate the recording of circulating money and easier collaboration in asset issuance.
In the latest trial, it’s reported that there were no issues, but aspects still need development given the significant volume of transactions processed by the companies mentioned above.
For context, Mastercard and Visa alone process nearly half of the world’s financial transactions due to their integration with several major banks worldwide. This necessitates the blockchain to have high scalability capabilities, thus requiring further development.
While having plans to be used for transaction management processes, the current primary focus of the blockchain is to serve as a platform for issuing and transacting investment assets in the form of debt securities and other securities typically issued by countries or commercial banks.
Examples of issued assets include government bond securities, central bank bond securities traded among retail investors, and bonds traded by central banks.
Additionally, it’s reported that there will be other assets managed through the ledger, though unfortunately, there are still no clear details on what these assets might be.
Unclear Details Yet to Be Published
Details regarding this product remain unclear, as the majority of infrastructure-related information is still held by its managers.
Currently, it’s unclear whether this blockchain will function solely as a regular ledger used by banks or will operate similarly to a public blockchain.
Given the status of these companies, it’s likely that this ledger will be a consortium where its structure is not linear like a typical blockchain but rather branching, akin to the XRP Ledger, to enhance scalability.
Information regarding the collaborating infrastructure partners for this blockchain is also yet to be published, as it’s still unclear who will be involved in building the blockchain ledger.
There are speculations and rumours that one of the companies involved in building this blockchain is Ripple, although other sources are stating that the network used is the infrastructure of projects like Securitize and Solana.
This is due to the track record of cooperation between these companies and the mentioned project names, such as government collaborations in several countries with Ripple and Visa’s collaboration with Solana.
Therefore, there is no definite view on the information from this news yet, so everything remains relatively uncertain.
But one thing that can be assured is that this news will boost blockchain adoption and potentially spark curiosity among traditional investors.
Unfortunately, since it’s still unclear, there are no tokens or coins that could be affected by this news, so for now, all that can be done is to wait for certainty and the development of this innovation.
