Six Indian banks to use JPMorgan’s Onyx blockchain to settle dollar trades

JPMorgan Chase & Co is launching a pilot project on June 5 that will enable banks to settle interbank dollar transactions on a blockchain-based platform, Bloomberg reported today.

JPMorgan has joined hands with six major private banks in India to participate in the pilot project. The banks include HDFC Bank, ICICI Bank, Axis Bank, Yes Bank, and IndusInd Bank Ltd, along with JPMorgan’s banking unit in Gujarat International Finance Tec-City (GIFT City), the report noted.

Kaustubh Kulkarni, senior country officer in India, and vice chairman of Asia Pacific at JPMorgan told Bloomberg that the pilot project will be running for the “next few months.” The project will help assess the performance and user experience of the banks using the blockchain platform, Kulkarni said.

The pilot project is set to go live upon receiving approval from the International Financial Services Center Authority, as stated in the report. The project will use JPMorgan’s Onyx blockchain platform, launched in 2020, to facilitate wholesale payment transactions.

Under the current system, dollar trade settlement takes a few hours. But transactions are not settled on the weekends and public holidays. The blockchain-based system aims to eliminate these constraints and enable round-the-clock trade settlements, according to the report. Kulkarni said:

“By leveraging blockchain technology to facilitate transactions on a 24×7 basis, processing is instantaneous and enables GIFT City banks to support their own time-zone and operating hours.”

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