JP Morgan Introduces Blockchain-Powered Kinexys Digital Payments in British Pounds within the UK
Kinexys Digital Payments, a digital payment infrastructure that enables repo traders to use blockchain deposit accounts on JPMorgan's proprietary network, is making waves in the financial industry. The service, which supports digital asset settlement innovation, operates within environments akin to digital securities sandboxes that test blockchain-enabled financial transactions.
The Digital Securities Sandbox
The Digital Securities Sandbox (DSS) is a joint initiative from the Bank of England and the Financial Conduct Authority (FCA) in the UK. While there are no explicit details about Kinexys Digital Payments’ specific activities within the DSS, its use by repo traders suggests that it serves as a digital payments infrastructure supporting blockchain-based securities trading and settlement. This aligns with the typical sandbox environment focused on testing innovations in digital securities and payments.
Potential Collaboration with Fnality
No direct information on a partnership or collaboration between Kinexys Digital Payments and Fnality has been made public. Fnality is known for building blockchain infrastructure for multi-bank settlement networks, particularly focused on tokenized cash and collateral management. Given Kinexys' role in blockchain deposit accounts used in securities settlement, a potential collaboration could theoretically involve integrating their blockchain payment and securities trading infrastructure with Fnality’s multi-bank settlement platform to enhance atomic cash-for-securities transactions and liquidity management. However, no concrete or confirmed details are available.
Expanding Use Cases
Nathan Ondyak, CEO at SwapAgent, believes integrating Kinexys Digital Payments could allow for operations beyond traditional branch cut-off times and programmable settlements in the future. SwapAgent's pilot with Kinexys Digital Payments is independent of the UK's Digital Securities Sandbox.
Trafigura, a global commodities trading company, is using Kinexys for 24/7 cross-border payments between its New York, London, and Singapore divisions. JP Morgan has launched Kinexys Digital Payments in GBP, enabling 24/7 support for corporate payments and foreign exchange in dollars, euros, and pounds.
LSEG's SwapAgent, a derivatives margin and settlement service, will use Kinexys Digital Payments for its post-trade services pilot.
Kinexys Digital Payments has processed over $1.5 trillion in cumulative transactions across various services, averaging around $2 billion in transactions daily. The platform could be one of the digital solutions considered for use in the absence of the Regulated Liability Network, a tokenized deposit payment solution by the UK's largest banks that is not yet live.
For updates on Kinexys Digital Payments, monitoring JPMorgan, Kinexys, and Fnality press releases or regulatory sandbox announcements would be advisable. Fnality, a tokenized settlement solution that uses central bank money, could potentially enable settlement of institutional transactions.
- The potential integration of Kinexys Digital Payments could offer extended services beyond traditional banking hours and programmable settlements, as suggested by Nathan Ondyak, CEO at SwapAgent.
- In the realm of technology and finance, a potential collaboration between Kinexys Digital Payments and Fnality, known for its blockchain-based multi-bank settlement networks, could theoretically facilitate atomic cash-for-securities transactions and improved liquidity management, enhancing insights on securities trading and settlement.
