Global Banks Pilot Blockchain-based Gold Settlement Platform

A group of global banks and financial institutions has completed the first pilot of a new blockchain-based gold trading platform.

AccessTimeIconDec 20, 2016 at 7:48 p.m. UTC
Updated Sep 11, 2021 at 12:45 p.m. UTC

A group of global banks and financial institutions has completed the first pilot of a new blockchain-based gold trading platform.

In total, 600 test bullion trades were settled on a platform being developed by Euroclear in partnership with blockchain startup Paxos. The group of financial institutions included Société Générale, Citi, Scotiabank, among other banks.

Transaction settlement service Euroclear first disclosed that it was working on the initiative earlier this year. The project is aimed at providing faster settlement and cheaper services for unallocated gold on the London bullion market.

Announcing the test's completion earlier this week, Scott, Euroclear director of product strategy and innovation, said in a statement:

"This is a real first step in bringing a new settlement capability to the London bullion market that will help lower risk and simplify the post-trade process."

In the months ahead, Euroclear and Paxos said they plan to solicit feedback from other stakeholders in London's bullion market and further hone the in-development platform.

The trial continues the trend of efforts by both established market players and new startups to apply the tech to the gold market. As far as London is concerned, there's significant trade volume up for grabs – last year, 17.9m ounces of gold (worth $20.7bn) were cleared each month, according to statistics published by The London Bullion Market Association.

Earlier this year IEX – the stock exchange that inspired the book Flash Boys by Michael Lewis – raised $9m to launch its Tradewind Market, a blockchain-based market also looking to bring increased transparency to precious metals.

Most recently, The UK Royal Mint announced it would soon launch its own blockchain-based gold trading platform.

Image of gold pound via Shutterstock

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
FTX Token DAO Raises $7M From Community of Sam Bankman-Fried Fans

The money is destined for a fund that will contribute to community-led projects across decentralized finance (DeFi) and crypto education.

CoinDesk - Unknown
2
CoinDesk - Unknown
Según Morgan Stanley, la demanda de GPUs podría ralentizarse si Ethereum pasa a proof-of-stake

El cambio tampoco resolverá los problemas de escala de Ethereum, según el informe.

CoinDesk - Unknown
3
CoinDesk - Unknown
First Mover Americas: Bitcoin Holds $21K as BTC Outflows Hit Record High

The latest moves in crypto markets in context for June 27, 2022.

CoinDesk - Unknown
4
CoinDesk - Unknown
Goldman Cuts Coinbase to ‘Sell’ Due to Fall in Crypto Prices and Industry Activity; Shares Drop

The company faces a difficult choice between shareholder dilution and effective employee compensation, the report said.

CoinDesk - Unknown