At HSBC, internal currency transactions of $250 billion already happened at the bank, enabled by its blockchain-based platform called HSBC FX Everywhere, writes Global Custodian.
The system has been in use over the past year, using a so called shared permissioned ledger to manage payments across HSBC’s internal balance sheet. It serves to automate several manual procedures and reducing reliance on external settlement networks, in the intra-company FX activity.
A sign of progress
So far, there were 3 million exchange transactions on the ledger, worth a total of $250 billion.
While that is only a fraction of HSBC’s currencies business, it could point to distributed ledger technology (DLT), including blockchain, becoming increasingly accepted in the daily activities of banks and financial institutions, according to Global Custodian.
Corporate treasuries next
“Following successful implementation inside the bank, we are now exploring how this technology could help multinational clients – who also have multiple treasury centres and cross-border supply chains – better manage foreign exchange flows within their organisations,” says HSBC’s interim global head of FX and commodities Richard Bibbey, in the Global Custodian article.