Credit Suisse Group and ING Groep have completed a 25 million euros (approximately $30.48 million) securities lending transaction on the use of the blockchain-based instrument. The firms revealed this information on Thursday as further initiatives which involve promising generation behind cryptocurrencies get nearer to yielding effects.
The companies said that these transaction included activities such as the banks swapping baskets of securities through an application from the financial technology company HQLAx which is built with a blockchain type created by the bank consortium R3.
Concerned firms mentioned that the business was once in a time an important example of a real-life capital markets transaction of its type that happened on the device making use of blockchain, an allotted ledger that is maintained through a community of computer systems on the internet.
Charley Cooper, a managing director at R3, mentioned in an interview that that was more evident in a fenced lab. He further stated that these are regulated institutions in a real market and it is an exceptional demonstration that blockchain solutions are being deployed in real commercial settings.
Financial institutions have capitalized millions of money in developing blockchain applications with the hopes that it could help them cut costs and also simplify a few back-office processes like the settlement of securities trades.
While the banks have announced many testing and experimenting events using the blockchain technology, it is still in the initial steps only a few of these applications are already live. Herve Francois, a blockchain initiative lead at ING said in an interview that the companies expect the application to be live by the end of the year.
Besides, the banks affirmed that the use of blockchain could make the securities lending process quick and even more capital efficient.
In the conventional settlement of securities lending trade, the primary securities are transferred between accounts and the process sometimes take days. The companies said that the solution would be instantaneous according to the blockchain application used by the banks.
Being one of the largest consortia in the Blockchain, New York-based has a network of more than 100 financial institutions. It developed Corda, a type of blockchain specially designed for financial transactions, and used to build the securities lending application.