Mastercard collaborates with major US banks for tokenised settlement trials

Leading payment company Mastercard, along with several major US banking institutions, have launched a Regulated Settlement Network (RSN), leveraging blockchain technology through a proof-of-concept (PoC). This RSN PoC system aims to enable banks to make transactions in tokenised commercial bank assets, U.S. Treasury bonds and securities, central bank digital currencies (CBDCs), and various other assets.

Mastercard collaborates with major US banks for tokenised settlement trials

At present, securities and assets operate within different systems, posing challenges for transactions. With the implementation of RSN, settlements will be streamlined onto a unified platform by converting assets into tokens and recording them on a distributed ledger.

Major institutions including Citi, Zions Bancorp, US Bancorp, JPMorgan, Wells Fargo, VISA, Swift, USDF, and TD Bank NA Citigroup will participate in testing this interbank settlement system with tokenised assets. The system’s functionality will be evaluated within a test environment emulating transaction in US dollars.

Mastercard has outlined that the goals of the project are to increase the efficiency of international settlements, as well as reduce error frequency and fraud cases.

The program manager of the RSN PoC will be the Securities Industry and Financial Markets Association (SIFMA), and audit and consulting firm Deloitte tasked with overseeing system operations for compliance with US regulations and providing advisory services.

Additionally, six other key participants — MITRE, Broadridge, BNY Mellon, Tassat Group, DTCC, and ISDA — have been invited to contribute their expertise to the project. Their involvement will provide valuable insights garnered from their experience in the field.

Earlier, Mastercard partnered with leading crypto exchange Binance to introduce a crypto card in Brazil.

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