Huobi: Global banks lead blockchain gold settlement platform

According to the Huobi Blockchain Research Center, a gold trading platform based on blockchain technology, which is participated by many international banks and financial institutions, has recently completed its first round of testing. A total of 600 test bricks participated in the settlement in this round of testing. The platform was jointly established by Euroclear, a European settlement system, and Paxos, a blockchain startup. The financial institutions involved in the establishment of the platform include many international banks including Societe Generale, Citibank, and Scotiabank.

Euroclear, a trade clearing service, first announced earlier this year that it was moving forward with the project, which aims to provide faster and cheaper settlement services for unallocated gold bars in the London bullion market.

Scott, Euroclear’s director of product strategy and innovation, announced the completion of the test earlier this week. He said in a statement:

“This is the first real step towards expanding new settlement capabilities in the London bullion market, reducing risk and streamlining the subsequent processing of trades.”

Euroclear and Paxos said they plan to seek feedback from other stakeholders in the London bullion market in the coming months and further refine the trading platform under construction.

The attempt continues a trend of established market players and emerging startups trying to apply blockchain technology to the gold market. Huobi Blockchain Research Center learned that in London alone, the trading volume generated by the entire market is very significant - according to data released by the London Bullion Market Association, the average monthly gold clearing volume reached 17.9 million ounces (worth $20.7 billion) last year.

Earlier this year, IEX — the stock exchange that inspired Michael Lewis’ bestselling book, Flash Boy — raised $9 million to launch the Trade Winds Market, a blockchain-based market designed to bring more transparency to precious metals trading.

Recently, the Royal Mint of the United Kingdom also announced that it will launch its own blockchain gold trading platform in the near future.