In less than a week after Deutsche Bank (NYSE:DB) and HSBC (NYSE:HSBC) partnered with other companies for digital asset custody, Citigroup Inc (NYSE:C) has now turned to the digital asset space to launch tokenized digital assets using its own wallet and blockchain.

Citi's Token Service will provide cross-border payments and liquidity all around the clock.

Read More: Deutsche Bank Joins Crypto Wave: Partners With Taurus For Digital Asset Custody

What Happened: Citigroup’s Citi Treasury and Trade Solutions launched Citi Token Services for delivering digital asset solutions to institutional clients using blockchain and smart contract technologies. For better cash management and enhancing trade finance capabilities, the service will integrate tokenized deposits and smart contracts into Citi’s global network.

Citi Token will convert customer deposits into digital tokens which can be transferred anywhere in the world. The client will not have to set up their own digital wallet and will be able to access the service through the bank’s existing systems. The bank will depend on a private blockchain owned and managed by the bank.

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In the first week of September, JPMorgan Chase & Co (NYSE:JPM) was looking at developing a blockchain-based digital deposit token for enhancing international transaction settlements. The bank is likely to introduce this product to corporate clients within 2024.

The Regulated Liability Network: The offering came amid Citi’s participation in a month-long test of a Regulated Liability Network wherein a unit of the Federal Reserve Bank of New York and other global banks also participated. The test will allow banks to simulate issuing digital money representing their customers’ own funds before settling through central bank reserves on a distributed ledger.

The result led to the finding that the use of digital dollars can improve wholesale payments.

“Frictions related to cutoff times and gaps in the service window will be reduced,” the global head of digital assets at Citigroup’s treasury and trade solutions division commented.

Also Read: Third Largest US Bank Citigroup In Layoff Talks After Management Restructure

As a pilot program, Citi served Maersk and a canal authority by digitizing solutions such as bank guarantees and letters of credit. The solution used in the pilot program led to instant payment capabilities to buyers and sellers which reduced transaction processing times from days to minutes.

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