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Singapore MAS experiments with blockchain cross-border payments

Te partnership was with the Bank of Canada and both parties said it was a success

MAS and Bank of Canada have been collaborating in the use of distributed ledger technology (blockchain) and central bank digital currencies to make the cross-border payment process cheaper and safer.

The results were linked up to their respective experimental domestic payment networks, named Project Jasper (Canada) and Project Ubin (Singapore), which are built on two different blockchain platforms. The project teams used a technique called Hashed Time-Locked Contracts (HTLC) to connect the two networks and allow Payment versus Payment (PvP) settlement.

PvP settlement is a process whereby a foreign currency is only traded if/when the transfer of another currency also takes place.

Scott Hendry, Bank of Canada Senior Special Director, Financial Technology explained the experiment as such:

“The world of cross-border payments is complicated and expensive: our exploratory journey into the use of Distributed Ledger Technology to try to reduce some of the costs and improve traceability of these payments has yielded many lessons. The importance of international cooperation through projects such as this one cannot be underestimated. Only through continued collaboration and fundamental research will it be possible for this technology to mature and for policy-makers to fully understand its potential,” he said.

The Jasper-Ubin project was carried out in partnership with Accenture and J.P. Morgan.

The Bank of Canada and MAS have jointly published a report that proposes different design options for cross-border settlement systems.

The report further suggests areas of research in blockchain interconnectivity mechanisms and alternative network models. This represents opportunities for further collaboration among central banks, financial institutions, and fintech firms.

“Together these projects have addressed many technical questions and brought the technology to a higher level of maturity. The next wave of central bank blockchain projects can make further progress by bringing technology exploration together with policy questions about the future of cross-border payments,” said Sopnendu Mohanty, Chief FinTech Officer, MAS.

Also Read: Deskera reportedly raises US$100M+ in extended Series A funding round

It is said that this experiment was the first such trial between two central banks with potential to increase efficiencies and reduce risks for cross-border payments.

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10 crazy blockchain ideas for Facebook

Imagine using Facebook to check into an airline

The Wall Street Journal coined Facebook’s blockchain project as Project Libra, approaching allies such as Mastercard and Visa. MIT’s Christian Catalini is said to be working on Facebook’s cryptocurrency efforts.

We know that two of the top lieutenants of Mark Zuckerberg are indeed on the team — David Marcus and Kevin Weil. Facebook is hiring aggressively for blockchain roles.I’m excited about the long term cryptocurrency utility and adoption of blockchain technologies.

This is a speculation on the 10 on-chain possibilities that Facebook’s efforts could power for the global citizen. What’s your take?

1. Peer to peer payments

With a Facebook USD-backed cryptocurrency, users can pay each other for meals, rent and anything that’s needed. Venmo might get jealous.

2. Peer to peer verification of identity

It’s a global and connected world, communities and persons can mutually verify identities to ensure that bad players are weeded out. A verified identity will have a check mark across their name with the no. of verifications. Peers are incentivized to deal only with other peers with strong verified identities.

3. Voting and delegation

To keep communities moving forward, it will be nuts for us to make every single decision and vote on what’s possible in our communities, meetup groups, social clubs and organizations. Everyone in the communities should be able to delegate or vote directly for decisions to be made on proposals and drafts to their benefit.

4. Invoiced and pay for goods and services

Businesses can invoice and charge users for their products and services. They should also be able to pay their employees, file taxes and do all kinds of financial functions seamlessly.

5. Lending and working with credit

Businesses should be able to automatically extend lines of credit and have payment periods in working with other businesses. This will enable more efficient business operations.

6. Invest in securities

Regular citizens and accredited investors should be able to invest through smart contracts and be issued securities for the businesses they’ve invested in.

7. Access any e-service, game, app

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Using their identity, citizens can authenticate and login for e-services, games and applications. They can opt to have personalized experiences only upon authentication of their verified identity.

8. Sharing and retrieving data with 3rd party e-service, game, app

Should a game require photos of the user from another service, the user should be able to authenticate and grant permissions for one-time sharing or retrieval. Without authentication of verified identity, services will not be able to perform such actions.

9. Travel and immigration using their global identity

With their identity, they could use their mobile device and private keys to authenticate themselves at immigration or when they check in for their flights. Doing so enables them to pass through seamlessly through the expedited immigration counters. Public travel records are available for countries to access.

10. Assets and information inheritance

Everything accessible by the verified identity of the citizen would be up for inheritance programmed to the citizen’s preference. Assets, information, services, securities owned can be passed on easily.

There’re many possibilities for Facebook to experiment. There will be barriers to adoption. We’re definitely excited about how mass adoption of cryptocurrencies and blockchain technologies will happen in the next few years.