Citi announced that it created an innovative application that uses blockchain technology to price and execute bilateral spot foreign exchange (FX) trades. As part of the Project Guardian collaborative initiative by the Monetary Authority of Singapore (MAS), this application tested successfully on USD/SGD pricing and trades.
Citi leverages blockchain technology for FX trades
This means the application can be applied to any fiat currency pair. Reportedly, this on-chain solution offers real-time quotes and record trades on a blockchain, supporting fixed and cryptographically secured stores of relevant data.
Only counterparties can access the details for quotes and trades, as per the compliance surrounding regulatory requirements. According to reports, Citi’s head of FX sales, Sam Hewson, said:
We are taking steps towards building foundational capabilities to offer liquidity, pricing and risk management to our global clients wherever they choose to trade – be it on traditional rails or on blockchain.
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This request-for-streaming (RFS) application aims to establish execution analyses through real-time post-trade analysis on one platform by exploring the use of oracles for bilateral messaging. In developing the application, Citi joined forces with T. Rowe Price Associates, Inc. and Fidelity International. The co-head of digital assets for markets at Citi, Shobhit Maini, added:
While blockchains have demonstrated promise for streamlining post-trade processes, our objective is to drive improvement at all stages of the trade life cycle, including pre-trade and execution.
Blue Macellari, the head of digital strategy at T. Rowe Price Associates, Inc., echoed this statement and said:
Developing user-friendly institutional-grade execution is key to future scalability. This application is an important first step towards unlocking the value of a full end-to-end blockchain-based trading lifecycle.
