Blockchain for Banking News

Citi unveils tokenized deposits for institutional trade, cash


Today Citi unveiled two digital asset solutions under the umbrella of “Citi Token Services”. Both services target institutions. One is a pilot for tokenized deposits, enabling organizations to move money between Citi branches worldwide and 24/7. The other is a trade solution that provides smart contract based bank guarantees that was piloted in collaboration with Maersk.

The trade application used smart contracts to trigger an instant payment using tokenized deposits.

Citi founded the Regulated Liability Network (RLN), a multi bank collaboration for digital assets, tokenized deposits and CBDCs. However, Citi Token Services is separate and complements the RLN work.

“Citi Token Services provides corporate treasurers with a new tool to manage global liquidity on a just-in-time, programmable basis,” said Ryan Rugg, Global Head of Digital Assets at Citi Treasury and Trade Solutions.

The bank emphasized that this operates on a permissioned Citi network, and clients don’t have to host blockchain nodes to participate.

One takeaway of the RLN was that the current legal framework supports the adoption of DLT. That said, U.S. banks have to get a non-objection letter from their regulators to participate in DLT and digital asset initiatives.

In the blockchain world, several solutions are rolling out to enable banks and corporates to move money around the world and manage liquidity globally. JP Morgan has its JPM Coin, which does something similar.

Both JPM Coin and Citi Token Services currently move money within branches of the bank. Each bank is involved in initiatives targeting interbank payments. In Citi’s case, that’s the Regulated Liability Network, and JP Morgan is a co-founder of Partior targeting cross border payments.

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