LONDON, Dec 13 (Reuters) - HSBC and Wells Fargo have begun
using a blockchain platform to settle bilateral foreign currency
(FX) trades in the latest sign of how technology which underpins
crypto assets is spreading to more mainstream activities.
Baton Systems, the company behind the Core-FX distributed
ledger technology, or DLT, said on Monday the two banks are
using the platform to settle FX trades using real currencies and
real accounts, in less than three minutes.
It avoids passing the trades through CLS, a third-party bank
widely used in the sector for settling FX trades, Baton said,
adding that such rapid settlement directly between the two banks
cuts exposure and settlement risks.
Last month SIX Swiss Exchange's new blockchain based digital
trading and settlement arm issued and its first bond.
Speedier settlement means tying up costly capital and
liquidity for a shorter period to insure against a trade going
wrong.
(Reporting by Huw Jones; editing by Jason Neely)