Goldman Sachs and Morgan Stanley go live with new blockchain-based FX settlement utility from CLS and IBM
FX settlement utility CLS went live today with its blockchain-powered payment netting service CLSNet, which provides settlement services to FX market participants to mitigate settlement risk, according to the company. Financial giants Goldman Sachs and Morgan Stanley are among the software’s first users, with “six more participants from North America, Europe and Asia, including Bank of China (Hong Kong), committed to joining in the next few months”, Coindesk reports.
CLS developed its new blockchain-based system in conjunction with global business IT firm IBM. CLSNet “runs on the Linux Foundation’s Hyperledger Fabric blockchain framework”, Finextra reports. This is the third blockchain platform powered by IBM tech to go live this year, along with food-tracking platform IBM Food Trust and trade finance software we.trade.
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According to Finextra, “the new platform is intended to reduce the post-trade risk present in settling foreign currency trades in emerging markets.”
Alan Marquard, chief strategy and development officer at CLS said: “A standardised and automated payment netting process will lead to improved intraday liquidity, reduced cost, improved operational efficiencies and ultimately support business growth.”
“With CLSNet now in production with two of the world’s largest banks, for a major market function, it is a testament to the ongoing maturity of blockchain technology and the value that it can deliver in practice,” Marie Wieck, general manager at IBM Blockchain, told the press.