The XDC token has successfully passed an experiment for fiat settlement in business-to-business transactions by SBI XDC Network APAC and SBI R3 Japan.
SBI Group announced this groundbreaking development via an official press statement today, May 31. This now completed experiment with the XDC token commenced in December 2023, leveraging the Corda blockchain and Corda Bridge.
Notably, SBI Group and the XDC Network partnered on May 31, 2023, when SBI VC Trade began handling Japan’s first crypto, XDC. Essentially, the settlement transaction trial using XDC coincided with the second anniversary of this strategic partnership.
Per the latest update, SBI Group aims to enhance the integration of the XDC Network with Corda and broaden the Corda Bridge technology applications.
The SBI Group is optimistic that these efforts will reinforce their partnership and lay the groundwork for enhancing the efficiency of business-to-business payment processes in trade transactions.
Background the XDC PoC
Significantly, these Japanese financial giants executed the proof of concept (PoC) to test the feasibility of using the XDC token for fiat settlements in B2B transactions by connecting two distinct blockchain platforms.
The first is Corda, a private blockchain renowned for its interoperability and privacy, which are crucial for B2B dealings. The second is the XDC Network, a layer-1 public blockchain network compatible with private chains. Notably, this connection was facilitated through the Corda Bridge.
This integration aims to facilitate comprehensive settlements that cover both the private aspects, such as confidential transaction data and the public aspects, like the transfer of value.
By doing so, they aim to provide an efficient settlement method that could reduce the time and cost of international trade transactions.
Results of the PoC
During the trial, SBI Group entities, acting as exporters and importers, successfully demonstrated the simultaneous processing of transaction information approval and settlement. In other words, the experiment confirmed the capability for instant remittance between the parties involved.
From a technical standpoint, the experiment allowed for the independent implementation of the CorDapp and Corda Bridge components. It was verified that the XDC payment functionality could be generically integrated into the CorDapp for various applications beyond just the settlement scenario tested in this experiment.
While this was the inaugural hybrid PoC involving the XDC Network and other blockchains, SBI Group believes the positive outcomes indicate that transferring value across different blockchain platforms is achievable without issues.
Expectedly, XDC’s success in this settlement experiment has attracted bullish sentiment from crypto community members.
😊 XDC | R3 https://t.co/n557onhNhW
— 🌸Crypto Eri 🪝Carpe Diem (@sentosumosaba) May 31, 2024
Future Developments
Regarding future developments, SBI Group has recognized the need for further testing to ensure that the system can facilitate immediate intercompany settlements without issues from the volatility of XDC prices or currency exchange rates.
SBI Group noted that this additional verification will necessitate partnerships with cryptocurrency exchange companies.
Moving forward, SBI Group plans to build on the findings from these tests by continuing its collaboration with SBI VC Trade and SBI Liquidity Market, the latter of which manages the group’s foreign exchange operations.
The objective is to refine the verification process and develop a robust service that accelerates settlements between businesses and also mitigates the risks associated with the fluctuating values of cryptocurrencies and foreign exchange rates.
