The stablecoin transaction pilot involved the deployment of stablecoin smart contracts for seven major global currencies and underlined the technology’s potential to reduce the time for cross-border transactions from days to minutes

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NAB completes cross-border stablecoin transaction. (Credit: National Australia Bank Limited)

National Australia Bank (NAB) has completed an intra-bank cross-border stablecoin transaction using its self-issued, newly minted ERC-20 tokens.

The pilot transaction was conducted on the public and permissionless Ethereum blockchain and involved the deployment of stablecoin smart contracts for seven major global currencies.

The bank has teamed up with Blockfold, a professional services consultancy specialising in tokenisation, and Fireblocks, an enterprise-grade digital assets platform, for the pilot.

Blockfold and Fireblocks used their expertise in smart contract creation, securely minting and burning stablecoin and managing direct custody of digital assets on the blockchain technology.

NAB said that the pilot transaction underlined the technology’s potential to reduce the time for cross-border transactions from days to minutes.

NAB markets executive general manager Drew Bradford said: “Bringing multi-currency stablecoins to market demonstrates NAB’s focus on simplifying international banking protocols to increase speed and transparency while lowering costs and reducing complexity for customers.”

“We believe that elements of the future of finance will be blockchain-enabled and we’re already witnessing a rapid change in the tokenisation market.

“The stringent governance frameworks we have in place ensures we can support the creation of a safe and reliable digital financial system.”

With the successful pilot, NAB becomes the world’s first big financial institution to complete a transaction using stablecoin on a layer-one public blockchain.

The Australian lender aims to expand the transactions across seven top currencies, Australian, New Zealand, Singapore and US dollars, Euro, Yen, and Pound Sterling.

The company plans to initially allow select corporate and institutional clients to transact using digital assets by the end of this year.

NAB said that its Australian stablecoin, AUDN, is fully backed one-for-one with the Australian dollar and managed as a liability of the bank, and supports its digital assets goals.

Also, conducting the transaction on a public, permissionless layer-one blockchain enhanced transparency, accessibility, and scalability.

Fireblocks CEO and co-founder Michael Shaulov said: “NAB’s successful trade execution marks the beginning of the evolution of financial services from Web2 to Web3, underpinned by blockchain technology as well as strong governance and risk management.”

BlockFold CEO and co-founder Francois Schonken said: “NAB’s multi-currency cross-border settlement execution on a public blockchain is exhilarating.

“This trade marks the first cross-border multi-currency exchange executed by a regulated large financial institution (NAB) backed stablecoin.

“The NAB eco-system of stablecoins puts in place cross-border payment rails that unlock tokenisation potential for both real-world assets and financial products.”