According to Financial Times, American banking conglomerate JP Morgan has inked a partnership with German industrial group Siemens and built a blockchain-based system for payments to be used by the latter.
JPMORGAN DEVELOPS BLOCKCHAIN SYSTEM FOR SIEMENS’ PAYMENTS- FT— *Walter Bloomberg (@DeItaone) December 20, 2021
Siemens begins to use blockchain payments
Siemens has stated that it is facing a much larger amount of payments now since it is using pay-per-use payment models, which are becoming popular these days. Hence the desire to try and put to use the nascent blockchain technology on which Bitcoin and other cryptocurrencies have been built.
Besides, a Siemens rep told Financial Times, there are new digital business models emerging and the old ones are beginning to fail to compete with them.
The new blockchain system will be utilized for the automatic movement of cash between accounts belonging to Siemens. So far, these funds are moved in USD but as of next year, the company plans to start pushing payments in EUR as well. As for the volumes of payments that the new blockchain system will have to process, Siemens did not comment.
Siemens is the first customer of JP Morgan's new system
The new DLT system for processing payments has been created by JP Morgan's unit Onyx. According to JPM, there is a line of customers already that want to trial the new payment system. However, the banking giant has decided to let Siemens use it first.
As banks seem to believe in blockchain much more than in crypto, they are starting to integrate DLT directly into their operations.
Last week, Wells Fargo and HSBC agreed to settle currency trades on DLT directly.