Top investment banking firm JP Morgan has announced a collaboration with the Monetary Authority of Singapore (MAS) to create a blockchain model that would improve cross-border payments.
This is according to a news report on the MAS office website. It disclosed more details about the blockchain prototype, pointing out how the new protocol will enable payments in different currencies on the network.
To add, Temasek, a government-owned investment company, also lends its support to the project.
MAS, Chief Fintech Officer, Sopnendu Mohanty, pointed out that payment based on decentralized technology has over time improved cost efficiency, creating unique opportunities for businesses.
This new blockchain model is a part of the ongoing Ubin project. Designed to also study the prospects of blockchain technology and its possible impact on the banking sector. Launched in November 2016, Project Ubin will definitely impact the banking sector.
MAS, investment banking giant JPMorgan and investment firm Temasek all came together to create this project. It is currently undergoing several tests to see if it matches the expectation of cutting costs. Consortium R3 and Deloitte have also previously been involved with the project testing.
More on the project
The project initially started out as a way to digitize the Singapore dollar using blockchain. However, it moved towards evaluating blockchain to enable real-time gross settlement system. Very similar to the system in use by most central banks.
Speaking of the project, MAS revealed that the prototype “will provide interfaces for other blockchain networks to connect and integrate seamlessly.” The network also comes with several other benefits like delivery-versus-payment (DvP) settlement with private exchanges. Also trade finance conditional payments, escrow and payment commitments.
Sopnendu also added that: “We hope this development will encourage other central banks to conduct similar trials, […] We look forward to linking up with more blockchain networks to improve cross-border connectivity. This will be a big step forward in making cross-border transactions faster, cheaper, and safer.”
Global Chief of clearing and IIN at JP Morgan, confirmed the news, expressing great joy in the partnership. He said, “by leveraging our key learnings from building the Interbank Information Network and the JPM Coin, J.P. Morgan is well-positioned to support the development of a blockchain-based payments network and operate at scale.”
Tech giant Accenture will compile and published a comprehensive document on Project Ubin in early 2020. The document will thoroughly explain how to use the blockchain for payments and securities.