Wells Fargo wants to launch cryptocurrencies to help its global cross-border payment business

On the evening of September 17, there was external news that US financial giant Wells Fargo was developing a cryptocurrency called Wells Fargo Digital Cash (Wellcoin) linked to the US dollar. It is understood that Wellcoin will be the first in Wells Fargo. Running on the blockchain platform, it will initially be piloted for internal settlement of corporate operations. Wells Fargo’s stakeholders said in a press release that Wellcoin will be able to address cross-border payments within its global network.

Lisa Frazier, head of Wells Fargo Innovation Group, told the media that the launch of Wellcoin would enable Wells Fargo to transfer funds in almost real time between outlets in different countries, helping to help Wells Fargo improve efficiency and reduce operating costs. According to Lisa, the project will begin trial operation in 2020. The trial will start with a dollar transfer and will gradually expand to other currencies in the later stages. The ultimate goal is to cover all branches of Wells Fargo in the world.

According to the financial network and chain financial understanding, Wells Fargo has already begun to lay out the blockchain industry as early as 2016. But unlike some companies, Wells Fargo has been exercising restraint in the application of blockchain technology. At the end of March this year, Wells Fargo’s chief executive Tim Sloan said: “The blockchain has been over-consumed.” So Wells Fargo is in the district. The main direction of the blockchain field has always been the cross-border payment that is closely integrated with its original business.

In October 2016, Wells Fargo, ANZ and SWIFT jointly developed a blockchain bank prototype. The prototype allows two banks to coordinate payments through Swift and provide real-time transaction records by using distributed ledgers. They believe that the platform can "improve the efficiency and speed of cross-border correspondent bank payments reconciliation and settlement."

At the end of July 2018, Wells Fargo submitted a patent application for tokenization management based on blockchain technology. It is understood that the technology can mark a variety of information, including documents, photos, audio, video and other digital media. Wells Fargo said the technology could be used to manage and protect sensitive information and data.

Traditional cross-border payment methods have many shortcomings such as high cost, long time, and low efficiency, and blockchain technology can solve these problems well. In fact, in addition to Wells Fargo, there are many traditional giants who are closely watching the blockchain + cross-border payment.

On September 11, MasterCard and blockchain software provider R3 today announced a strategic partnership that will jointly develop and test a new blockchain cross-border payment solution that will initially focus on linking by MasterCard. The global payment infrastructure supported by the Card Clearing and Settlement Network.

On August 30th, PNC Bank, the top ten lender in the United States, established a partnership with RippleNet. PNC Bank will use the blockchain technology already established by RippleNet to handle international payment services.

In June, VISA announced the launch of a blockchain cross-border payment network called “VISA B2B Connect”. It is understood that the blockchain cross-border payment network can effectively reduce cross-border payment costs. The network currently covers more than 30 trade channels worldwide and is expected to expand to 90 markets by the end of this year.

On February 14th, JPMorgan Chase launched a cryptographic currency “JPM Coin” similar to the stable currency, which is used to realize real-time transaction settlement between customers of wholesale payment business.

In addition, many traditional companies such as Ant Financial, Goldman Sachs, China Merchants Bank, etc. are also actively developing blockchain + cross-border payment commercial landing technology.

Author: Financial Network Wu Yingjun

Source: Finance and Economics Network on Finance