In light of what JPMorgan recently created with its cryptocurrency plan backed by a bank, it is worth remembering that another large institution tested a token to connect global payments for the first time in 2015.
About Citicoin
Named “Citicoin”, the bank never formally announced the project outside Citigroup’s innovation lab in Dublin, not even as proof of concept. The idea was to rationalize the global payment processes. As such, there are obvious parallels with the much acclaimed JPM Coin.
However, after evaluating the experiment (not to mention the contempt of the Bitcoin community at the time), Citi concluded that while technology has the potential to deliver on its promises, there were other, more effective and efficient ways to make improvements in the Payments.
That’s in line with Citi’s current head of innovation lab, Gulru Atak, global head of innovation for treasury and trade solutions. Regarding the cryptography experiments of his predecessors.
The plans
“We have three separate systems in place and running within Citi now that we actually implement the distributed block accounting technologies. “Everyone is inside the laboratories right now, so there’s no real money that goes through these systems yet, they’re at a pre-production level to be clear.” We also have an equivalent bitcoin in operation, again inside the laboratories, so we can exploit what we call a ‘Citicoin’, for lack of a better term. It’s in the laboratories, but it’s to make sure we’re at the forefront of this technology and that we can take advantage of the opportunities within it. ”
“Based on the lessons learned from that experiment, we actually decided to make significant improvements to existing rails taking advantage of the payment ecosystem and within that ecosystem, we are also considering FinTech or regulators around the world, including SWIFT”.
Citi’s blockchain strategy
As such, Citi’s blockchain strategy in recent years has been to find ways to integrate legacy systems, Atak said, citing the bank’s 2017 partnership with Nasdaq, CitiConnect, designed to streamline payments around securities. private. That project, he said, also has parallels with JPM Coin.
“CitiConnect did not issue Stablecoins, but the infrastructure that was used was similar to the issue of coins in a blockchain platform,” Atak said. “But it was purely to integrate into a blockchain-enabled system at the end of our client and have it connect to our legacy payment processes in real time”.