He is backed up by Stephen Grainger, said “the Bank has decided not to build 2016, admits that “a single blockchain is Head of North America at SWIFT, who the renewed RTGS service on Distrib- not viable, the future is in different cur- says, “there is a recognition in the indus- uted Ledger Technology, in light of its rency blocks with Ripple an interconnec- try that perhaps distributed ledger findings that the technology is not yet tion.” The fact that he has joined the new technology at this point isn’t ready for sufficiently mature to provide the excep- company, along with Marjan Delatinne, the wholesale application to manage all tionally high levels of robustness required who had been leading customer engage- correspondent banking”. for RTGS settlement … Further work is ment for SWIFT’s GPI, suggests that required to address privacy and system Ripple believes the blockchain can be The bankers on SWIFT’s GPI Vision scalability in particular, and these and part of a new global payments system in Group also explain GPI’s reliance on tra- other topics suggested by this initial work some way. ditional processes by claiming that nei- will drive the Bank’s future research pro- ther banks nor their regulators are ready gramme on this technology.” What’s not to like? to risk the international payments system on an untested technology. So Tony Ripple rebuts the criticism of its use of For treasurers the battle looks like a win- Brady, managing director and head of the blockchain by saying that ILP gets win. If Ripple does what it says, treasur- global product management for BNY around the issues raised because it simply ers will benefit. If it fails but in the Mellon Treasury Services, who is a connects existing bank ledgers rather process forces SWIFT to improve its core member of the SWIFT GPI Vision than holding the ledger itself. In effect, offerings, then treasurers benefit. And Group, says: “Our early view is that banks connect their core systems to the GPI, as Raymaekers says, “is real! More while blockchain and distributed ledger Ripple network – analogous to how they than 40 global transaction banks have have a fair amount of promise, it’s a lit- currently connect their core systems to begun actively using or implementing the tle early to try to tackle cross-border the SWIFT network and the ILP is used SWIFT GPI service, with another 50 in to co-ordinate the payments. This the implementation pipeline. Hundreds of payments, particularly high-value cross-border payments where we’re put- addresses the fears banks have expressed thousands of GPI payments have already ting millions of dollars at risk.” about the blockchain around privacy, been sent across more than 85 country scaleability, regulatory approval and the corridors.” Treasurers are already win- It’s not just SWIFT, which has perhaps a issue of having to get all parties to a block- ning. vested interest in downplaying the new chain to agree to validate a transaction. technology. As explored in the block- chain article (page 30), the Canadian However, even Marcus Treacher, Global central bank has come to the same con- Head of Strategic Accounts, Ripple and clusion and in May, the Bank of England, formerly HSBC’s Global Head of Pay- in its paper, “A blueprint for a new RTGS ments Innovation and a member of the service for the United Kingdom”, also Global Board of SWIFT from 2010 to Get informed advice from 2000+ senior treasurers FREE whenever you need it. Get to solutions faster Avoid costly mistakes www.eurofinance.com/ectn 20 // TREASURY PERSPECTIVES 2017/2018 www.eurofinance.com