Exploring On-Chain Settlement Systems for Tokenized Assets
America’s prominent financial institutions are working together on a groundbreaking initiative to delve into an on-chain settlement system for tokenized cash and assets, aiming to revolutionize the financial sector.
Regulated Settlement Network (RSN) Proof-of-Concept
The Securities Industry and Financial Markets Association (SIFMA) announced the launch of a Regulated Settlement Network (RSN) proof-of-concept (PoC) within the regulated U.S. financial sector. The initiative seeks to explore the feasibility of a shared ledger for settling various tokenized assets, including commercial bank money, wholesale central bank money, and U.S. Treasury securities.
- Members of the program: Citi, J.P. Morgan, Mastercard, Swift, TD Bank N.A., U.S. Bank, USDF, Wells Fargo, Visa, and Zions Bancorp.
- Supporting services: Deloitte providing advisory services, and two additional unnamed vendors offering technology infrastructure and legal analysis.
Project Manager and Objectives
SIFMA is responsible for managing the project, with the RSN PoC aiming to establish an interoperable network for multi-asset transactions on a programmable shared ledger operating 24/7.
- Research Focus: Settlement of tokenized cash and securities on a unified system.
- Test Environment: Conducted in a simulated environment with multi-asset transactions in U.S. dollars.
Industry Perspective and Predictions
Key industry figures foresee the integration of blockchain technology and tokenized transactions into traditional financial systems, marking a significant shift towards innovation and efficiency.
- Mastercard’s Perspective: Raj Dhamodharan emphasizes the importance of blockchain technology collaborations to enhance market infrastructures for programmable, frictionless settlements.
- Chainlink Creator’s Statement: Sergey Nazarov anticipates a global shift towards blockchain infrastructure and smart contracts, endorsed by oracle networks, within the financial ecosystem.
Hot Take: The Future of Financial Settlements
As major financial players converge to explore the potential of on-chain settlement systems for tokenized assets, the industry is on the brink of a transformative era in financial transactions and settlements, demonstrating a commitment to driving innovation and efficiency.
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