First blockchain initiative to bring greater efficiency to the settlement of physical gold
Euroclear and itBit, a financial services company delivering blockchain services for capital markets, today announced their collaboration to explore opportunities in creating a next generation settlement service for the London gold market.
The settlement of unallocated gold is a very capital-intensive process. Euroclear and itBit are working with relevant market participants to develop a service to significantly minimise risk leading to a reduced capital charge, deliver true delivery versus payment and reduce balance sheet constraints. Euroclear has partnered with itBit based on its proprietary blockchain infrastructure technology and flagship product, Bankchain. The Bankchain product is a private network of trusted participants that clears, tracks and settles trades in close to real-time.
Angus Scott, Director, Product Strategy and Innovation at Euroclear, commented: “Euroclear is pleased to be working with itBit on this initiative. As an open and resilient infrastructure, our strategy has been to work with relevant industry stakeholders. We have also created an advisory group, which recently convened to discuss the building of the new service with the ambition to make the London bullion market more efficient.”
Chad Cascarilla, CEO of itBit, added: “We are excited to be partnering with Euroclear to develop a trusted digital infrastructure for gold. Precious metals are the first use case for Bankchain, and Londonbullion is a market in which a distributed ledger can have an immediate benefit.”