IDB and CITI’s Innovation Lab make international payments on blockchain

The Inter-American Development Bank announced last Thursday, April 8, through a press release, that together with the CITI Innovation Laboratory they make international payments on blockchain.

“The Inter-American Development Bank (IDB) and Citi’s Innovation Laboratory successfully conclude a proof of concept for sending international transfers from the United States to Latin America and the Caribbean, using tokenized money on blockchain. This solution offers complete traceability of transactions, commissions and exchange rates”, he said through the statement.

The company explained that the LACChain blockchain network enabled the sending of various disbursements from the IDB headquarters in Washington D.C. towards a receiver in the Dominican Republic.

According to Marcos Allender, blockchain specialist at the Inter-American Development Bank (IDB) and technical leader of LACChain, “for the proof of concept, the IDB deposited dollars in a Citi bank account and these funds were blocked, tokenized and transferred using digital wallets. The funds, once tokenized, were converted into local currency -Dominican pesos- with the ratio established by Citi, making the ratios, payment status and commissions totally transparent, since the transaction could be always consulted on the blockchain network. of LACChain”.

“The exploration and adoption of new technologies for the optimization of international payment processes is essential to support the IDB Group’s mission to improve the lives of the region through the financing of development projects”, said Rubén Gutierrez, project leader from the IDB Treasury Department.

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The company indicated that it is expected that, in addition to having the potential to improve international disbursements, the development of this type of solution may have a direct impact on the social and financial inclusion of vulnerable groups, enabling improvements in areas such as sending remittances.

“There are many cross-border payment applications focused on inclusion, such as official development assistance and international remittances. They play an extremely important role in the economies of our region, the final beneficiaries and the families receiving these remittances”, added Irene A. Hofman, CEO of the IDB Lab.

For his part, Piotr Marciszewski, Citi project coordinator, highlighted that “we have learned a lot in this joint effort with the IDB about the use of blockchain technology for cross-border payments and we have demonstrated that it is possible to connect the LACChain network with the APIs of WordLink”.