We are moving to a world of instant payments, but how we get there is still uncertain.
A blockchain-based payments system designed for central banks has just completed its first live transactions with the Bank of England. Created by Fnality, the system processed live payments from member banks, Lloyds, Santander and UBS.
The transactions took place with digitally represented funds held at the Bank of England allowing the funds to move instantly between the parties. The entire premise of this new system is to remove the cost and time of managing collateral on our current T+2 or T+1 system.
I have been watching Fnality for a couple of years now and have been so impressed by what they are building (watch my interview with the Fnality CEO here). These live transactions represent a major step forward as they have moved beyond the testing phase.
Central banks are not known to be on the cutting edge of technology so kudos to the Bank of England for taking the lead on this project.
Fnality is starting in England but they are in talks with central banks around the world. So stay tuned.
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Fnality completes ‘world’s first’ blockchain payments at Bank of England
Fnality, a blockchain-based wholesale payments firm, said on Thursday that shareholders Lloyds Banking Group, Santander and UBS had completed the “world’s first” live transactions that digitally represent funds held at a central bank.
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