Using blockchain and smart contracts, Citigroup, a U.S. banking giant, launched a tokenization service for institutional clients to manage cash and finance trade, the bank announced on Monday.
The smart contracts replace bank guarantees and letters of credit, which are usually slow and cumbersome due to paperwork and manual processes.
The bank said it tested the service with Maersk, a shipping company, and a canal authority to speed up the processes.
“Citi Token Services will offer ‘always-on,’ programmable financial services such as cross-border payments, liquidity and automated trade finance solutions for institutional clients,” the bank said.
