JPMorgan Chase and Co., the American multinational financial giant, has recently entered into a partnership with six prominent Indian banks, including HDFC Bank Ltd., ICICI Bank Ltd., Axis Bank Ltd., Yes Bank Ltd., and IndusInd Bank Ltd, to launch a blockchain-based platform designed to settle interbank dollar transactions. This groundbreaking move is expected to further bolster New Delhi’s efforts to establish the Gujarat International Finance Tec-City (GIFT City) as a prime competitor to other major international financial centers, such as Singapore, Hong Kong, Abu Dhabi Global Market (ADGM) and Dubai’s IFC.
In pursuit of a more streamlined and efficient interbank dollar transactions system, JPMorgan will be running a pilot project over the next few months to evaluate the banks’ experiences with the platform. The objective is to harness blockchain technology to expedite these transactions, which currently require several hours to complete within the existing settlement systems. Through the introduction of blockchain technology, however, transactions could be executed almost instantaneously.
The pilot project, scheduled to commence on Monday, will employ JPMorgan’s blockchain platform Onyx, pending approval from the International Financial Services Center Authority. According to Kaustubh Kulkarni, senior country officer, India and vice chairman, Asia Pacific at JPMorgan, the goal is to enable GIFT City banks to provide support for their own time-zone and operating hours through the utilization of blockchain technology. By doing so, transactions can be completed on a 24×7 basis, thereby facilitating instantaneous processing.
Since its inception in 2020, Onyx has served as JPMorgan’s dedicated blockchain-based platform for wholesale payment transactions. And the prestigious banking firm is not alone in recognizing the potential of GIFT City, as several other prominent international systemic banks, such as Deutsche Bank and MUFG, have also set up shop in the center.
While the adoption of blockchain technology within the financial industry undoubtedly holds significant potential for increased efficiency, reduced costs, and improved security, the success of this pilot project is contingent upon a myriad of factors and market conditions. As such, interested investors should conduct thorough research before allocating funds, keeping in mind that the author and publication hold no responsibility for any personal financial losses incurred as a result of the presented content.
Source: Coingape
