Jeremy Fox-Geen. Chief Financial Officer at Fintech firm Circle and Kash Razzaghi, the firm’s Chief Business Officer, have noted that digital currencies and the blockchains on which they travel can offer considerable utility “as a new, unified infrastructure for payments, commerce and capital markets built directly into the internet.”
They explained that Circle’s USD Coin (USDC) can “be the dollar’s next form factor as it evolves beyond the electronic ‘ACH dollars’ that financial institutions send back-and-forth privately across computer infrastructure designed decades ago.”
They added that this infrastructure “lays the foundation for a new ‘internet of money’ that enables financial value to move around the world at any time, almost instantly and with less cost than traditional payment systems.”
According to Circle. the potential benefits of blockchains and digital currency “are so immense that stock trading venues are also exploring how to achieve these cost and time savings.”
In 2021, the SEC added plans “for next-day settlement to its work agenda39 and the DTCC — which processes $1.7 trillion in daily trading volume — announced completion of its ‘Project Ion’, a proof-of-concept private blockchain to significantly shorten equities settlement from traditional ‘T+2’, or two days after the trade is agreed upon.”
The firm’s management also mentioned that Project Ion successfully “launched in 2022 and has begun a test run in which it processes an average of 100,000 trades per day.”
They also noted in a blog post that DTCC is working on Project Ion in collaboration “with many traditional markets firms, including Barclays, BNY Mellon, Charles Schwab, Citadel Securities, Citigroup and Credit Suisse.”
“While not as fast as the near-instant settlement available in decentralized markets, even a move to T+1 could drive major improvements in equities market structure and release an entire day’s worth of trapped margin. The DTCC notes that T+1 could significantly reduce collateral requirements for broker/dealers while enhancing market resilience and reducing systemic, operational and other risks.”
Until open blockchains are widely accepted, “much of this activity may take place on fully private, permissioned blockchains.”
USDC could be “well positioned to play a role here as well,” the team at Circle claims.
They also noted that as you navigate the new world of digital assets, it can “be difficult to find trusted information to help you separate substance from hype.”
The Circle team claims they have “decades of experience building and running global, publicly traded companies and is actively working alongside policymakers around the world to help shape the future of stablecoins and digital currency.”
They claim that they can help you “power your firm across this next phase of the internet with solutions designed specifically for businesses and institutions.”
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