Wells Fargo Working on A Blockchain-based Stablecoin Project for Internal Settlements

Global banking institutions are moving towards blockchain solutions to significantly improve their payment and settlement services. Wells Fargo, the U.S.-based banking giant is reportedly working on its new stablecoin linked to the U.S. Dollar and will run on the company’s own private blockchain network.

In the press release on Tuesday, September 17, the company said that this moves comes as its effort to improve the cross-border settlements among its internal global payments network. Using the new stablecoin, the bank will thus process instant payments at all of its international locations making it absolutely easy and swift to move digitized cash.

The bank also said that its internal Distributed Ledger Technology (DLT) network will see a number of decentralized applications (DApps) developed over a period of time. The benefit of DLT is that it provides high security and absolute transparency to all records of transactions.

Lisa Frazier, head of the Innovation Group at Wells Fargo said: “As a result of the increasing digitization of banking services globally, we see a growing demand to further reduce friction regarding traditional borders, and today’s technology puts us in a strong position to do that”.

Frazier further added: “We believe DLT holds promise for a variety of use cases, and we’re energized to take this significant step in applying the technology to banking in a material and scalable way. Wells Fargo Digital Cash has the potential to enable Wells Fargo to remove barriers to real-time financial interactions across multiple accounts in multiple marketplaces around the world.”

Without affecting much of its banking infrastructure, the Wells Fargo Digital Cash will help real-time movement of customer money. The banks DLT platform will work even in the expanded operating hours unlike the existing limitations posed by traditional networks.

Early next year in 2020, the bank will be running a pilot test for completing USD transfers initially. Later, it plans to introduce multi-currency transfers to the Wells Fargo global banking network.

Besides Wells Fargo, other global banking institutions like JP Morgan and Deutsche Bank are also jumping on the blockchain bandwagon. Recently, Deutsche Bank said that it will be joining JP Morgan’s blockchain-based IIN network to improve and streamline interbank payments settlements across the globe.