HSBC has been on a blockchain mission in the last few months, as it looks to streamline various arms within its business to become more cost effective and competitive. In its latest move, the banking giant is looking to form strategic partnerships with a number of top Korean banks in order to deploy its Voltron blockchain platform and make it commercially available. Voltron is currently in the testing stages, but if HSBC can form enough strategic partnerships, we could see Voltron becoming commercial by the end of 2019.
What is Voltron?
Voltron is a blockchain based platform for banks that permits the settlement of trade invoices, process letters of credit, and much more in record-breaking time. Currently, the document processing time in the financial industry takes between 5 and 30 working days, Voltron can cut this time down to less than 24 hours. By using blockchain and distributed ledger technology (DLT), Voltron handles and processes documents faster than anything HSBC or the banking world has ever used before.
HSBC Going All Out on DLT
At the end of February, HSBC released a report on its blockchain focused forex settlement system. It had been trialling its new system called FX Everywhere for a 12-month period to test its efficiency and effectiveness. In the report, HSBC noted that it managed to save just over 25% of the fees associated with settling forex trades. When you run that level of saving over a $350 billion a year department, the fees saved are astronomical.
Banks Falling in Love with Crypto
Banks were once seen as vehement opponents of crypto and blockchain technology, but they are starting to change their tune. Banks all around the world are warming up to crypto and blockchain technology, with many banks – such as HSBC – implementing this technology themselves. However, the Union Bank of Philippines is taking things a step further and is deploying crypto ATMs in their branches. It’s the first time a major bank has moved to promote cryptocurrencies, and it has gone down incredibly well with its clients. Customers can now access the crypto world through a legal, safe, and simple ATM from inside the bank lobby.
If HSBC can deploy Voltron, it will begin to save even more money and process transactions faster than ever before. This will help the global bank pick up more accounts from large businesses looking to transfer money between suppliers faster than ever before. Embracing blockchain technology is benefiting HSBC and the banking world, allowing end users and customers to enjoy smaller fees and a superior banking product.