Citi has developed a new foreign exchange (FX) solution utilising blockchain infrastructure in order to price and execute bilateral FX spot trades.
The current phase has tested spot FX for USD and SGD, with expectations for the underlying solution to be used for any fiat currency pair.
The new application, currently available to clients, was created as part of the Monetary Authority of Singapore’s (MAS) ‘project guardian’ – a collaborative initiative between MAS and financial market players “seeking to test the feasibility of applications in asset tokenization and DeFi, while managing risks to financial stability and integrity”.
The FX offering was developed in collaboration with T. Rowe Price Associates and Fidelity International.
Sam Hewson, head of FX sales at Citi, said: “We are taking steps towards building foundational capabilities to offer liquidity, pricing and risk management to our global clients wherever they choose to trade – be it on traditional rails or on blockchain.”
The on-chain solution records trade executions on a blockchain and provides real-time streaming of price quotes whilst allowing for compliance with institutional requirements and regulatory demands.
The offering supports cryptographically secure record-keeping of trade data and only counterparties to a quote or trade have access to underlying trade details.
Blue Macellari, head of digital asset strategy at T. Rowe Price Associates, said: “Developing user-friendly institutional grade execution is key to future scalability. This application is an important first step towards unlocking the value of a full end-to-end blockchain based trading lifecycle.”