The new Citi Token Services offering will leverage blockchain and smart contract technologies to provide digital asset solutions for institutional clients and will integrate tokenised deposits and smart contracts into Citi’s global network
Citi Treasury and Trade Solutions (TTS), a division of Citigroup’s Institutional Clients Group, has developed and tested its new Citi Token Services for cash management and trade finance.
The new token service from Citi will leverage blockchain and smart contract technologies to provide digital asset solutions for institutional clients.
It will integrate tokenised deposits and smart contracts into Citi’s global network, advancing the company’s core cash management and trade finance capabilities.
The new Citi Token Services will provide cross-border payments, liquidity, and automated trade finance solutions to institutional clients on a 24/7 basis, said the company.
Citi services global head Shahmir Khaliq said: “Digital asset technologies have the potential to upgrade the regulated financial system by applying new technologies to existing legal instruments and well-established regulatory frameworks.
“The development of Citi Token Services is part of our journey to deliver real-time, always-on, next-generation transaction banking services to our institutional clients.
“This development goes hand-in-hand with our industry-leading work on the Regulated Liability Network to create interoperable digital asset solutions on a multi-bank basis.”
Citi has worked together with Danish shipping and logistics company Maersk and a canal authority to digitise the solution that works similarly to bank guarantees and letters of credit in the trade finance ecosystem.
In the pilot, the programmable transfer of tokenised deposits enabled instant payments to service providers through smart contracts.
The technology offered a completely digital process to both buyers and sellers with instant payment capabilities, reducing transaction processing times from days to minutes.
Furthermore, Citi Token Services has also been applied to a global cash management pilot, to help clients transfer liquid cash between Citi branches on a 24/7 basis.
Maersk regional treasury manager Marie-Laure Martin Americas said: “We are pleased to have collaborated with Citi in the successful test pilots for the guarantee solution using digitized tokens and smart contracts.”
Citi Treasury and Trade Solutions global assets head Ryan Rugg said: “Citi Token Services provides corporate treasurers with a new tool to manage global liquidity on a just-in-time, programmable basis.
“Frictions related to cut-off times and gaps in the service window will be reduced. Our solutions within the Citi network are complemented by inclusive and open industry collaboration on initiatives like the Regulated Liability Network.”