Citi is providing financial resolution for secondary market transactions conducted over Nasdaq's Linq Platform, using distributed ledger technology from Chain to address the challenges of liquidity in private securities by streamlining payment transactions between multiple parties.
An API-based link between the CitiConnect for Blockchain platform and Nasdaq's Linq is used to enable straight through payment processing and automated reconciliation by using a distributed ledger to record and transmit payment instructions.
Chain’s blockchain platform, Chain Core, is powering both Citi’s and Nasdaq’s services.
A number of payment transactions have been already been concluded including Citi’s automated processing of cross-border payments, in an initiative which is billed by Nasdaq CEO Adena Friedman as an important moment in the commercial application of blockchain technology.
Says Friedman: "Through this effective integration of blockchain technology and global financial systems, we can realise greater operational transparency and ease of reconciliation, which can have profound implications for outdated administrative functions in the capital markets."
Benefits cited for the approach include a seamless end-to-end transactional process for private company securities, direct access to global payments and increased operational efficiency and ease of reconciliation with real-time visibility of payment transactional activity on the blockchain ledger.
The initiative has its roots in Nasdaq and Citi’s founding membership of the IDEO CoLab in June 2015 to explore emerging technologies such as blockchain. In September of that year, both Nasdaq and Citi Ventures invested in Chain’s series B funding round with other leading financial institutions.