Citi Treasury and Trade Solutions (TTS) is testing a groundbreaking program called Citi Token Services. This initiative leverages blockchain and smart contract technologies to provide Citi’s institutional clients with digital asset solutions. Therefore, the company is enhancing the fundamental capabilities of cash management and trade finance.
Citi Token Services strives to address the needs of institutional clients who frequently require continuous access to programmable financial services. It will offer cross-border payments, liquidity, and automated trade finance solutions all the time – 24/7.
Citi mirrors the functionality of trade finance tools, such as bank guarantees and letters of credit in its proposed solution, through TTS. The bank collaborated with the shipping company Maersk and a canal authority in a trial to accelerate processes typically known for their lengthiness and difficulty due to paperwork and manual procedures.
The investment bank has successfully piloted the project, accomplishing tokenized deposit transfers and instantaneous payments through smart contracts. This initiative is poised to drastically reduce transaction processing time, compressing it from days to minutes.
Ryan Rugg, the Global Head of Digital Assets of Citi TTS, stressed that this initiative provides corporate treasurers with a potent tool for managing global liquidity on a just-in-time, programmable basis. This approach aims to reduce friction related to cut-off times and service gaps.
The private/permissioned blockchain technology that forms the foundation of Citi Token Services is owned and overseen by Citi. This prevents clients’ need to host a blockchain node to gain access to these services.
In June, the company revealed its partnership with Metaco for crypto custodian business. This move responded to the increasing integration of blockchain technology into traditional finance.
Citi’s persistent dedication to advancing digital asset solutions demonstrates its ambition to enhance its products and services across diverse sectors. These include digital currency, trade, securities, custodial services, asset management, and collateral mobility.