National Australia Bank (NAB) has completed the first-ever cross-border stablecoin transfer by a major financial institution on a public layer 1 blockchain. The bank’s fully backed AUDN stablecoin, which is connected to the Australian dollar, was utilised for the intrabank transfer.
It also intends to provide corporate transactions of this nature by the end of the year.
The companies confirmed that the transaction was completed on the Ethereum blockchain and that smart contracts for seven currencies were used. These currencies included dollars from Australia, New Zealand, Singapore, and the United States, as well as euros, Japanese yen, and British pounds.
Drew Bradford, NAB’s executive general manager for markets, comments: “We believe that elements of the future of finance will be blockchain enabled and we’re already witnessing rapid change in the tokenisation market. The stringent governance frameworks we have in place ensures we can support the creation of a safe and reliable digital financial system.”
The stablecoins were created as bank liabilities in accordance with the ERC-20 standard.
NAB partnered on the effort with the Fireblocks platform and BlockFold professional services professionals.
The creation of smart contracts, the secure minting and burning of its stablecoin, and the administration of direct custody of digital assets on blockchain technology are just a few instances of how they might apply their skills.
“Australia continues to be a global torch bearer for tokenisation in financial services, with NAB leading the charge in the world’s first use case of a large financial institution leveraging a public blockchain for cross-border payment rails,’’ states Michael Shaulov, CEO and Co-founder of Fireblocks.
‘’NAB’s successful trade execution marks the beginning of the evolution of financial services from Web2 to Web3, underpinned by blockchain technology as well as strong governance and risk management.”
François Schonken, the CEO, and co-founder of BlockFold, continues: “NAB’s multi-currency cross border settlement execution on a public blockchain is exhilarating. This trade marks the first cross-border multi-currency exchange executed by a regulated large financial institution (NAB) backed stablecoin. The NAB eco-system of stablecoins puts in place cross-border payment rails that unlock tokenization potential for both real world assets and financial products.”