Financial Institutions: Blockchain Activity Analysis

September 7, 2015     By : Amit

Similar to the industry’s first report on the various non-financial use cases of blockchain, our article on the timeline of various banks that have shown interest and started experimenting with the blockchain has received an unprecedented response with 1.8K+ social shares and thousands of pageviews. Thank you for such an overwhelming response.

While we have seen that banks are exploring the distributed ledger technology, other financial institutions have also been active in investing (time and/or money) in this space. The following are some of the banks and other FIs who have shown intent on blockchain. The below timeline depicts the announcements by different FIs and their partners (if any) along with the potential use cases they are exploring.

Blockchain

Deutsche Bank:

The bank has said that it has been exploring various use cases of blockchain in areas like payments and settlement of fiat currencies, asset registries, enforcement and clearing derivative contracts, regulatory reporting, KYC, AML registries, improving post-trade processing services, etc. It has been experimenting on these technologies at their innovation labs in London, Berlin and Silicon Valley (July 2015).

NASDAQ:

The stock exchange firm initially revealed (May 2015) that they were planning to use blockchain as an enterprise-wide technology to enhance their capabilities on NASDAQ Private Market Platform. NASDAQ Private Market Platform is a new initiative launched in January 2014, to enable pre-IPO trading among private companies. It has also said that they would leverage Open Assets Protocol, a colored coin concept, to build their private exchange platform. Later, in June 2015, it announced a partnership with Chain, a blockchain infrastructure provider for FIs and enterprises.

DBS Bank:

The bank organized a blockchain hackathon in Singapore in partnership with Coin Republic, a Singapore-based bitcoin company & Startupbootcamp FinTech. (May 2015)

BitX, Blockstrap and Colu provided the APIs for the two-day hackathon series. The winners were Omnichain (first place, an investment platform for emerging markets), Nubank (second place, provides banking for the unbanked) and BlockIntel (third place, a transaction security platform).

EBA:

Euro Banking Association (EBA) has released a report (in May 2015) talking about the implications of crypto-technologies from the perspective of transaction banking and payment professionals in the coming one to three years. It has noted that these technologies could be leveraged by banks to reduce governance and audit costs, to provide better products and faster time to market.

US Federal Reserve:

Federal Reserve is reportedly working with IBM on developing a new digital payment system tied to blockchain. (Mar 2015)

SCB:

In a post on LinkedIn, Anju Patwardhan, Chief Innovation Officer of Standard Chartered Bank, said that blockchain could be leveraged to cut costs and improve the transparency of financial transactions. (July 2015)

There have also been reports that derivatives companies CME Group, Deutsche Boerse, clearing houses DTCC (depository trust & clearing corporation) and EuroCCP are working on projects around the use of blockchain in areas such as clearing. Also, there has been news that money transfer service provider Western Union could possibly look into Ripple technology to understand blockchain.

Below is a brief of banks experimenting with blockchain that we have previously reported.

Fidor Bank:

The bank has partnered with Kraken to provide a digital currency exchange in EU, and with Bitcoin.de, a P2P BTC trading platform in Germany. It later partnered with Ripple Labs to provide money transfer services.

LHV Bank:

Reported to have started working on blockchain technology in June 2014. They developed an app based on colored coins called Cuber Wallet in June 2015. They also have partnerships with Coinbase and Coinfloor, and are experimenting on digital security with blockchain.

CBW Bank, Cross River Bank:

Partnered with Ripple Labs to build risk management system and provide lower cost remittance services.

Rabobank, ABN Amro, ING Bank: Exploring blockchain for various banking services. Rabobank has also partnered with Ripple Labs.

Goldman Sachs:

Goldman Sachs participated as a lead investor in bitcoin startup Circle Internet Financial Ltd.’s $50M funding round. It has also reported extensively on bitcoin and blockchain in their annual publication Future of Finance.

BBVA Ventures:

Investor in Coinbase. Has also released research report stating interest in blockchain technology.

Santander:

Claims to have 20-25 use cases for blockchain and has a team called “Crypto 2.0” to research the use of blockchain in banking.

Westpac:

Westpac had partnered with Ripple to develop a low-cost, cross-border payments platform. Reinventure, its VC arm, participated in Coinbase’s $75M Series C funding.

UBS:

Has a cryptocurrency lab in London and is experimenting in the areas of payments, trading & settlement, smart bonds. It is planning to build an enterprise-wide product called “utility settlement coin” in partnership with Clearmatics. It has also stated that they have 20-25 use cases of blockchain for finance.

BNY Mellon:

Created own currency called “BK Coins” as a corporate recognition program which can be redeemed for gifts and other rewards.

Barclays Bank:

The bank has two bitcoin labs in London that are open for various bitcoin and blockchain entrepreneurs, coders and businesses. It has also partnered with Safello, to develop various banking services on blockchain. It is also running accelerators to provide blockchain enthusiasts mentoring and a chance to work with the bank on specific projects (Everledger is one of the companies that has emerged from Barclays’ accelerator program). Barclays also claims to have 45 experiments they want to do internally.

CBA: Has partnered with Ripple Labs to implement blockchain ledger system for payment settlements between its subsidiaries.

USAA Bank: Created a research team to study uses of bitcoin.

ANZ Bank: Partnered with Ripple to explore potential use cases of blockchain.

BNP Paribas: Experimenting at making transactions faster by using blockchain.

Societe Generale: Planning to staff employees with BTC, blockchain and cryptocurrency expertise.

Citibank:

They have set up three separate systems within Citi that deploy blockchain-based distributed technologies. They developed an equivalent to bitcoin called Citicoin, which is being used internally to understand the digital currency trading system better.

 

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Amit

Amit is the Co-Founder & Chief Curator of Let's Talk Payments. He has a strong background in strategy and market analysis and has advised dozens of clients (ranging from startups to Fortune 500) in payments, commerce and technology. His vision with LTP is to provide the same level of analytical rigor that analysts put into their work and combine it with Content 2.0 technology to offer unparalleled satisfaction for readers in this space.

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