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JPMorgan Chase & Co has partnered with six Indian banks to introduce a blockchain-based platform in India’s newest international financial hub, GIFT City. This development is expected to significantly boost New Delhi’s attempts to position GIFT City as an alternative trading center to Singapore and Dubai.
The Reserve Bank of India has already started a domestic non-deliverable forward market settled in dollars at GIFT City. However, the existing settlement system could take a few hours for the settlement to complete, and transactions are not settled on weekends or public holidays. This new real-time blockchain-backed system will remove these hindrances and make the settlement available 24×7.
By leveraging blockchain technology to facilitate transactions, processing will be instantaneous, enabling GIFT City banks to support their time zone and operating hours. The pilot project will use JPMorgan’s blockchain platform, Onyx, which was formed in 2020 for wholesale payment transactions.
This partnership between JPMorgan and the six Indian banks will lead to a faster, cheaper, and more secure way of settling interbank dollar transactions. This will benefit both banks and customers, as the system is expected to provide a seamless, near-instantaneous settlement process that is available round-the-clock.
Introducing this blockchain-based platform is a significant milestone in the financial industry, as it marks a shift towards a more efficient and secure way of conducting transactions. It is expected to pave the way for more such collaborations in the future and could even lead to the adoption of blockchain technology in other financial sectors.
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