In its continuous attempt to pursue innovation, JPMorgan, a global finance leader, is once again exploring blockchain technology. This time, it has partnered with six major Indian banks to transform interbank settlement of US dollar transactions.
The partnership, as Bloomberg reported on June 5th, brings together JPMorgan and prestigious Indian banks such as HDFC Bank, ICICI Bank, Axis Bank, Yes Bank, IndusInd Bank, and JPMorgan’s banking unit at Gujarat International Finance Tec-City (GIFT City).
By leveraging blockchain technology, JPMorgan aims to overhaul the current settlement system and usher in a new era of efficiency. The project’s aim, according to Kaustubh Kulkarni, JPMorgan’s senior country director, is to allow instantaneous transactions around the clock.
Typically, interbank settlement could take hours to complete and was entirely off-limits on weekends and public holidays. JPMorgan’s audacious blockchain pilot project intends to eliminate these constraints, as Kulkarni says:
“With blockchain technology facilitating 24×7 transactions, processing becomes instantaneous, empowering GIFT City banks to operate according to their time-zone and hours.”
This initiative also aspires to cement New Delhi’s GIFT City as a formidable alternative trading center to Singapore and Dubai, strengthening India’s global presence in the financial sector.
To ensure success, JPMorgan plans to conduct a comprehensive pilot project over the next few months, analyzing the banks’ experience with meticulous attention to detail. The project will launch on Monday and utilize JPMorgan’s cutting-edge blockchain platform, Onyx, following approval from the International Financial Services Center Authority.
This latest announcement comes after JPMorgan’s previous launch of Onyx in 2020, a groundbreaking blockchain-based platform designed to enhance the quality of wholesale payment transactions. As of April 2023, the bank transacted a staggering $700 billion in short-term loans through Onyx.
Interestingly, this development also coincides with JPMorgan currency strategists recently detecting signs of growing de-dollarization. Although the dollar’s share of exports and foreign exchange reserves has fallen, de-dollarization is still emerging, particularly in commodities.
JPMorgan’s unwavering pursuit of blockchain technology is reshaping the finance industry, revolutionizing interbank transactions, and empowering financial institutions worldwide. With the pilot project set to launch, the ambitious collaboration between India and the global finance powerhouse is receiving the world’s attention.
Compiled by Coinbold