Banking giant Citigroup has successfully completed a proof-of-concept for blockchain-based cross-border payments in collaboration with the Inter-American Development Bank, or IADB.
According to a Thursday announcement, Citigroup’s Citi Innovation Labs and the IADB enabled several disbursements from the United States to a recipient in the Dominican Republic, using the LACChain blockchain network — a proprietary effort by IADB’s regional program LACChain.
As part of the project, the IADB deposited tokenized funds denominated in U.S. dollars in a Citi account and transferred the funds using digital wallets, IADB’s blockchain specialist and LACChain technical leader Marcos Allende explained. “After tokenized, these funds were converted to local currency — Dominican pesos — with the exchange rate established by Citi,” he said.
The blockchain-based pilot enabled IADB to provide instant traceability of transactions, exchange rates and fees, potentially bringing a new method of making cross-border payments from the United States to countries in Latin America and the Caribbean.
“There are many applications of inclusive cross-border payments, such