As key aspect of both bank’s distributed ledger technology (DLT) ventures, the Monetary Authority of Singapore (BAS) transferred funds to the Bank of Canada (BoC) without any intermediates. The project’s scientific know-how was created with the assistance of technology consulting consulting firm Accenture and American bank JP Morgan.
The process was made possible by linking two DLT networks: MAS’ nascent Project Ubin platform, and Project Jasper of BoC. The procedure was facilitated by connecting two DLT networks: MAS’ emerging Project Ubin platform, and Project Jasper of BoC.
Both banking institutions have been dabbling with their own native digital coins and distributed ledgers using what they refer to as “hashed time-locked contracts,” reads the announcement.
These contracts, put otherwise, guarantee all payments are made in the right moment and order. The banking institutions assert they can process global payments much faster than traditional systems that necessitate intermediaries to validate deals. The Bank of Canada Venture Jasper and the Singapore Monetary Authority Program Ubin are running on privatized Corda and Quorum frameworks, respectively.
JPMorgan and bookkeeping giant Accenture, which helped the creation of platforms, also collaborated with banks to ensure the trade feasible.
Commenting on the project, MAS chief fintech officer, Sopnendu Mohanty, “The next wave of central bank blockchain projects can make further progress by bringing technology exploration together with policy questions about the future of cross-border payments.”
He further stated
“It is challenging work, and we welcome other central banks to join us in this global collaboration, to bring benefit to consumers, businesses and the broader financial industry.”
Like other bank-pioneered blockchain payment projects at different stages of development internationally, cost-cutting and effectiveness lay at the core of central bank trading, which respondents claim is the first to have been finished successfully. MAS and BoC later released a comprehensive report debating the benefits of the combined network.
The document says “In our tests, no other action would proceed if any action fails, thus ensuring the end to end consistency of a transaction.”
The synopsis said:
“In the correspondent banking method of payment, the sender and receiver trust the correspondent bank. In this DLT-based system using HTLC, trust will still be required, albeit in the technical system rather than in a third party.”
MAS had initially eyed 2020 as a prospective period for Ubin to start delivering concrete results.