Along with other financial institutions in the UK, Barclays, HSBC, and Citi are starting a collaborative project to test tokenized deposits.
A group of British banks, including Barclays and Citigroup, is working on a new pilot of tokenized deposits to enhance the tracking of banking payments.
The British trade group UK Finance announced in a press release that the lenders are starting the “UK Regulated Liability Network” trial phase and will be using a “shared ledger” to simplify cross-border transactions. Lee Braine, Barclays chief technology office stated:
“We hope these experiments will provide insights into how a common platform for innovation could enhance customer experiences with new payments functionality and also mitigate the risk of fragmentation in retail payment markets.”
Before the technology is used commercially, participating organizations are anticipated to use the trial platform for two to three years, according to a comment made by Quant CEO Gilbert Verdian to Bloomberg.
Payment networks like Mastercard, NatWest, Nationwide, and others actively participate in the trial in addition to banks and Quant. The experimentation phase, slated to last until the summer of 2024, will focus on several areas, such as analyzing the advantages for customers and businesses, examining technical viability, and resolving the legal framework related to the operation of a shared ledger settlement system.
Uncertainty surrounds whether the “shared ledger” is being constructed on an already-existing blockchain network, but other organizations are investigating how to combine their tokenization services with already available goods.
For example, at the beginning of April, GF Securities, an investment banking company in Hong Kong, made news when it introduced a locally tokenized commercial paper on the Ethereum blockchain, a significant development for the region’s digital asset ecosystem.
