Citibank is launching a blockchain-based offering that tokenizes customer deposits for instant transfers.
U.S. banking giant Citibank is making a foray into the blockchain space with a new offering that caters to its institutional clients.
Dubbed Citi Token Services, the new platform will convert customers’ deposits into blockchain-based tokens that can be instantly transferred anywhere in the world.
The new offering is based on a private blockchain developed by Citi and utilizes smart contracts, per the banking giant. Additionally, the system is underpinned by a “completely digital process” that reduces transfers from several days to minutes.
Citibank partnered with Danish logistics company Maersk and an unnamed canal authority to pioneer the new solution for trade finance.
During the pilot, Maersk pre-funded its wallet on Citi Bank’s platform with digital tokens instantly transferred to the canal authority upon delivery of services agreed on by both parties.
Citibank’s newly developed solution also finds a use case outside trade finance. Per the official announcement, Citi Token Services will also offer cash management solutions to clients. Customers can seamlessly move liquidity across different Citi Bank branches around the clock.
The New York-headquartered bank boasts 13,000 institutional clients that could adopt its new blockchain-based service. The company banks 90% of global Fortune 500 companies and has over $2.4 trillion in assets.
Banking giants banking on the blockchain
The world’s biggest banking institutions are increasingly interested in blockchain technology, albeit privatized versions that allow them complete control over client assets. Unlike public blockchains, private versions such as the ones developed by Citi are faster but largely centralized.
In the past, The Crypto Basic has reported developments around JPMorgan developing a blockchain-based payment solution for Siemens and Germany’s Deutsche Bank, researching the technology’s potential for cross-border transfers.