While the cryptocurrency market continues its volatile journey, many of the world’s largest banks have been quietly building on the technology that powers it: blockchain. Over the past few years, a handful of pilot initiatives by both public and private financial institutions have demonstrated blockchain’s potential to transform traditional banking systems. These projects signal that the technology may be more than a passing trend, and could represent a pragmatic shift toward adoption for an industry often criticized for resistance to change.
The commitment of major banks to these projects signals a growing recognition that blockchain could be more than a passing trend. For an industry that can often be criticized for its resistance to change, these projects represent a bold step forward — and a glimpse into a more efficient, transparent, and innovative financial system. Here are five key blockchain projects backed by the world’s largest banks:
Fnality International Is Reimagining Cross-Border Payments
Fnality International is an ambitious initiative aiming to establish a network of blockchain-based payment systems leveraging tokenized central bank money. Backed by a consortium of global banks, including Santander, HSBC, Barclays, and UBS, Fnality seeks to simplify cross-border payments, known for high fees, slow transaction times, and lack of transparency. Their solution, “Utility Settlement Coins” (USCs), are digital representations of fiat currencies that promise near-instant settlement and reduced counterparty risk. Securely backed by reserves in central banks, these ensure regulatory compliance and stability. The platform integrates with existing financial systems, like real-time gross settlement (RTGS) systems. However, the initiative still faces hurdles, including regulatory approval and widespread adoption.
JPMorgan’s Liink Is Building a Blockchain Highway for Banks
JPMorgan Chase has been a leader in blockchain experimentation, and its Liink network is one of the most mature projects in the sector. Originally named the Interbank Information Network (IIN), Liink is a permissioned blockchain designed for faster and more secure information exchange among financial institutions. The platform addresses core banking challenges related to interbank communications. For instance, verifying account information or resolving payment disputes, which can take days via traditional channels, now take minutes on Liink. Over 400 financial institutions worldwide are part of Liink, showing the strong interest in the network’s promise to reduce friction and enhance transparency. JPMorgan is extending its blockchain efforts with Onyx, a digital asset division looking into tokenized deposits and decentralized finance (DeFi) applications. Projects like JPM Coin, a stablecoin tied to the US dollar, are integrated into the Liink ecosystem, highlighting JPMorgan’s plan to offer a wide range of blockchain-enabled financial services.
Project Agora Aims to Reinvent Trade Finance
Trade finance, an industry worth over $5 trillion annually, has long been hindered by its complexity and inefficiencies. Project Agora, spearheaded by HSBC, BNP Paribas, and other banking giants, attempts to change this with blockchain. The project creates a shared digital ledger that tracks trade transactions in real time, reducing reliance on paper documentation and manual processes. A key feature is its ability to tokenize trade assets such as invoices and letters of credit, allowing banks and corporations to trade these assets in a transparent and liquid market. This increases cash flow for businesses and reduces fraud by creating an immutable record of transactions. The project has shown early promise, with pilot transactions showing reductions in processing times.
Canton Network Is Set on Synchronizing Financial Markets
Swiss financial services leader SIX, working with Deutsche Börse and Goldman Sachs, is pioneering the Canton Network. This blockchain initiative aims to establish a unified infrastructure for financial markets, enabling seamless data sharing and transaction synchronization across fragmented systems, boosting innovation and efficiency in capital markets. Using the Digital Asset Modeling Language (DAML), the Canton Network focuses on solving the lack of interoperability between different blockchain systems. By providing a secure and scalable framework for synchronizing workflows, the network supports applications ranging from securities issuance to asset servicing. A standout feature is the emphasis on privacy and compliance. Unlike public blockchains, which broadcast transactions to all participants, Canton leverages advanced cryptographic techniques to ensure data is shared only with relevant parties, addressing major concerns for financial institutions.
Versana Platform Wants to Transform Syndicated Loans
The syndicated loan market, valued at over $4 trillion globally, is known for its inefficiencies. Enter the Versana Platform, a blockchain-powered solution supported by major banking players. Designed to streamline loan servicing, Versana provides a centralized platform where all parties can access real-time data, which reduces manual errors and delays. The solution is built on DAML of the Canton Network Blockchain. “J.P. Morgan, BofA, Citi and Credit Suisse were the initial investors,” Versana Founding CEO Cynthia Sachs told PYMNTS. “Now, we’ve grown that to nine investors, including major institutions like Barclays, Morgan Stanley, Deutsche Bank, Wells Fargo and U.S. Bank.” Sachs added, “Versana is not just about modernizing the market. We want to continue to innovate and offer new solutions that help the market grow and scale. Everyone wins when the market has the best data and the technology to use it.”
