Mizuho Trials Blockchain for Cross-Border Payments

Mizuho has announced that it recently completed a test involving bitcoin that focused on cross-border securities settlement.

Mar 8, 2016 at 4:05 p.m. UTC
Updated Sep 11, 2021 at 12:10 p.m. UTC

Japanese banking group Mizuho has completed a blockchain test focused on cross-border securities settlement.

The test used the Open Assets Protocol, a commonly deployed implementation of colored coins that provides an added layer of functionality to the bitcoin blockchain. Using Open Assets, bitcoins can be specially marked to represent other assets on the blockchain.

According to an 8th March press release, the test included the participation of Japanese IT giant Fujitsu, including its research and development arm Fujitsu Laboratories.

The participants said that the test, which took place between December and February, showed that post-trade processing times can be reduced using blockchain applications.

Mizuho said in a statement:

"In the system, continuously generated blocks containing trade information were chronologically linked as blockchain, becoming information that could not be tampered. And, because the information could be shared between multiple companies, the partners confirmed that it was possible to shorten the time required in the post-trade process."

Near-instant settlement

The trial's aim, Mizuho said, was to seek a method of facilitating the post-trade process that would both shorten the time involved as well as reduce the possibility of data tampering.

"The goal was to enable low-cost, low-risk cross-border securities transactions by building a system utilizing blockchain technology that can almost instantly share matched trade information in the post-trade process as data that cannot be tampered with, but without building a large-scale settlement system from scratch," the bank said.

Mizuho said that it offered its "expertise with the securities settlement process" to the project, with Fujitsu developing the test system that was used. Fujitsu Laboratories managed the trial itself, according to the companies involved.

Mizuho and Fujitsu aren’t the only companies in the finance space looking at applying blockchain tech to potential solutions for post-trade settlement.

Last year, a group of firms involving the London Stock Exchange, Société Générale and UBS began work on exploring the technology for this purpose.

More work ahead

The companies involved said that they intend to use the data gleaned from the experiment to prepare for future efforts.

For Mizuho, the announcement adds to the growing body of blockchain tech work it is conducted. Last month, the bank disclosed that it was working with IT consulting firm Cognizant to develop an internal recordkeeping system using the technology.

Mizuho, which was an early banking interest in the space given its past work with now-defunct bitcoin exchange Mt Gox, is also involved with work on a syndicated loan system that uses blockchain applications.

That project sees Mizuho partnering with Information Services International-Dentsu (ISID), Microsoft Japan and blockchain startup Currency Port.

The bank is also one of more than 40 banking partners of the blockchain consortium led by startup R3.

The Festival for the Decentralized World
Thursday - Sunday, June 9-12, 2022
Austin, Texas
Save a Seat Now

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Trending

1
CoinDesk - Unknown
UnicornDAO Raises $4.5M to Empower Women and LGBTQ NFT Creators

The DAO is led by Nadya Tolokonnikova of the Russian art collective Pussy Riot and involves Beeple, Grimes and Gary Vaynerchuk.

The DAO is led by Nadya Tolokonnikova of the Russian art collective Pussy Riot and involves Beeple, Grimes and Gary Vaynerchuk.

CoinDesk - Unknown
2
CoinDesk - Unknown
Matt Prewitt: Let’s Use New Forms of Money to Commit to Our Communities

More local money could lessen the incentive to “exit” the people who need the resources, says Matt Prewitt, president of the RadicalxChange Foundation.

More local money could lessen the incentive to “exit” the people who need the resources, says Matt Prewitt, president of the RadicalxChange Foundation.

CoinDesk - Unknown
3
CoinDesk - Unknown
Ethereum se encamina a la fusión de Testnet en junio

La fusión de la red de prueba permitiría a los desarrolladores trabajar en cualquier riesgo o error potencial antes de que Ethereum pase a ser una red proof-of-stake.

La fusión de la red de prueba permitiría a los desarrolladores trabajar en cualquier riesgo o error potencial antes de que Ethereum pase a ser una red proof-of-stake.

CoinDesk - Unknown
4
CoinDesk - Unknown
US Treasury Official Warns Crypto Industry to Proactively Sanction 'Problematic' Wallets

FinCEN Associate Director Alessio Evangelista said crypto service providers shouldn't wait for the government to designate a wallet if it's being used for illicit activity.

FinCEN Associate Director Alessio Evangelista said crypto service providers shouldn't wait for the government to designate a wallet if it's being used for illicit activity.

CoinDesk - Unknown