The Moscow Credit Bank has issued a bank guarantee in Chinese Yuan based on blockchain technology. This would make it the first financial product of this type in the country. The bank guarantee is worth more than 100 million Chinese Yuan, which currently amounts to almost $145,000.
Made use of Masterchain Blockchain Platform
Reportedly, the transaction was carried out through the Masterchain blockchain platformwhich is the Russian national blockchain network created to transfer digital assets between participants.
The financial institution emphasized that the advantage of executing the transaction was on-chain, that “the beneficiary did not have to wait for the paper version and did not have to make a separate request to the bank to verify the authenticity of the document issued. to confirm.”
A bank guarantee, in turn, is a financial security that can be offered by a lending (financial) institution. Through a contractual agreement, a bank agrees to assume financial responsibility for a specific transaction if the customer defaults on its obligations. Bank guarantees are often used in international trade transactions to ensure that payment is made or goods are delivered as promised.
Ready-made Bank guarantee
A ready-made bank guarantee is shown on the Masterchain blockchain platform, which has been agreed by 3 parties. The bank has stated that the document cannot be forged or lost. The bank guarantee is expressed in Chinese currency, because the importer’s contracts are linked to this currency. If a payment is made under the guarantee, the beneficiary will receive Russian Rubles at the exchange rate agreed upon by the parties.
The Director of the International and Structured Finance Department of the Masterchain Blockchain Platform, noted the following:
Most foreign trade contracts are executed in Chinese currency and the demand for payments in Yuan is only increasing. This is a logical step for the market and we will see more examples of this in the near future. The decision will be particularly relevant for large groups of companies with many subsidiaries that regularly accept bank guarantees in large quantities.
Consumer pilot for Russian CBDC
The Russian central bank is preparing to launch the first consumer pilot for its central bank digital currency (CBDC) on April 1, 2023, as part of the country’s ongoing crypto development. It is reported that about 13 local banks and merchants will conduct digital Ruble transactions.
Originally, the CBDC pilot was planned for 2024, but this date has been brought forward as the Russian central bank was looking for SWIFT alternatives due to Western economic sanctions. It is not yet known what the results of this pilot will be.
