The banking giant Citigroup successfully completed a proof of concept for blockchain-based cross-border payments in cooperation with the Inter-American Development Bank or IDB.
According to an announcement made on Thursday, Citigroup’s Citi Innovation Labs and IDB enabled multiple payouts from the United States to be made to a beneficiary in the Dominican Republic over the LACChain blockchain network. an effort by the IDB’s LACChain regional program.
As part of the project The IDB deposited token funds denominated in US dollars into a Citi account and transferred the funds using digital wallets. explained the IDB blockchain specialist and technical director of LACChain, Marcos Allende. “After tokenization, these funds were converted into the local currency (Dominican Pesos) using the exchange rate set by Citi.” He said.
The blockchain-based pilot allowed the IDB to track transactions, exchange rates and fees instantly, which could represent a new method for cross-border payments from the US to Latin American countries and the Caribbean.
“There are many uses of inclusive cross-border payments, such as official development aid and international remittances. There is no doubt that they are extremely important to the economies of our region, and especially to the final beneficiaries and the families who receive them Transfers “, pointed out Irene Hofman, CEO of IADB Lab.
The IDB is an international organization that supports the economic development, social development and regional integration of Latin America and the Caribbean. The IDB has actively researched blockchain technology to accomplish its mission. The innovation laboratory IDB Lab set up its blockchain-focused LACChain program in 2019
The LACChain Open source runs on the blockchain and smart contracts platform quorum of JP Morgan.
Citigroup is no stranger to blockchain technology. In 2015 the bank developed Three blockchain-based systems and a pilot cryptocurrency nicknamed “Citicoin” examine more efficient cross-border transactions.