Australian banks look to blockchain
IBM public cloud Lygon blockchain platform has successfully conducted its pilot with Australian banks ANZ, Commonwealth Bank of Australia (CBA) and Westpac, and a group of 20 independent Australian businesses.
The project saw banks issue “bank guarantees” in under 24 hours using the Lygon blockchain service compared to the currently used paper-based alternatives which take over a month in some instances.
A Bank Guarantee is a kind of guarantee from a lending organization. The bank guarantee signifies a lending institution ensures that the liabilities of a debtor is going to be met. In other words, if the debtor is unsuccessful to settle a debt, the bank will cover it.
Lygon chairman Nigel Dobson said in the regard:
“The commercialization of the Lygon platform represents a significant milestone for blockchain technology in Australia and globally.”
He added that by digitizing a bank guarantee, the firm had essentially transformed a three-way contract. “We’ve digitized the paperwork, the process, and the legality behind it,” he said.
Moving forward, the platform has also onboarded new applicants in the second quarter of 2020 alone and is on track to support several other bank-related processes such as amendments and cancellations.
After the commercial launch of the Lygon, the firm hopes to advance the digital bank guarantees to the customers and international markets starting 2021.
A Hotbed of Blockchain Activity
The Australian economy has proved to be a hotbed for blockchain technology products and services, including the use of public blockchains like Ethereum for conducting international trade and logistics.
Apart from Lygon, the country has unveiled a National Blockchain Roadmap that heavily features the technology and its uses, promising benefits, and recently instated a service that allows Australians to purchase Bitcoin from over 3,500 national post offices.
Ripple, the blockchain company, has partnered with the country’s premier Australian National University in Canberra to teach the “blockchain law” courses to interested students, as per earlier reports.