2 weeks ago
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Global banking heavyweight Citigroup is preparing to launch a blockchain-based remittance service for Japanese corporate customers using tokenized deposits, potentially as early as this year, Nikkei reported Wednesday.
The service would enable companies to send foreign currencies instantly, including at night and during holidays, overcoming restrictions that apply to traditional cross-border bank transfers. According to Shahmir Khaliq, Citi’s head of services, the offering would be the first of its kind from a foreign financial institution for corporate customers in Japan.
Tokenized deposits are being developed alongside stablecoins as the foundation for next-generation payments. Rather than creating a separate banking system, they use existing bank infrastructure and represent traditional deposits digitally so they can move across blockchain networks.
The planned service would allow Japanese companies to move foreign currencies instantly between Japan and Citi operations in the US, UK, Singapore, Hong Kong and Ireland. Citi would take responsibility for administrative and risk-management processes, reducing the amount of preparation required from corporate customers.
Citi’s planned expansion into Japan’s tokenized deposit market could help encourage the corporate adoption of blockchain-based financial infrastructure.
The bank moves roughly $6 trillion in funds daily and ranks Japan among its five most important markets worldwide. Citi sees expanding tokenized deposit services in Japan and other markets as a way to build coverage across major financial centers throughout Asia-Pacific.
Citi has already integrated tokenized deposits into its Citi Token Services offering, allowing institutional clients to move liquidity across participating Citi branches on a 24/7 basis.
Disclosure: This article was edited by Vivian Nguyen. For more information on how we create and review content, see our Editorial Policy.
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