- Ava Labs’ AvaCloud and Citi collaborate on an innovative on-chain solution for simulated spot foreign-exchange trades using Avalanche blockchain.
- Citi’s application, part of Project Guardian, leverages private permissioned Avalanche Evergreen Subnets for real-time price quotes and simulated trade executions.
- Blockchain technology adoption in legacy capital markets is empowered by AvaCloud’s features and Avalanche’s native interoperability.
Ava Labs’ AvaCloud, the leading managed custom blockchain service provider offering private and permissioned Avalanche blockchains. In this article, we delve into how AvaCloud’s cutting-edge technology was utilized by Citi to test an innovative application that leverages blockchain infrastructure for pricing and executing simulated bilateral spot foreign-exchange (FX) trades. This groundbreaking solution is part of Project Guardian, a collaborative initiative by the Monetary Authority of Singapore (MAS) and the financial industry. Read on to explore the details of this revolutionary application and the unique features of AvaCloud’s blockchain service.
Citi’s On-Chain Solution for Simulated Spot FX Trades
Citi, a renowned global financial institution, has harnessed AvaCloud’s capabilities to develop an on-chain solution that provides real-time streaming of price quotes and records simulated trade executions on the Avalanche blockchain. The immutable and cryptographically secure nature of Avalanche ensures the integrity and transparency of trade data, making it an ideal choice for this application.
The initial focus of the application, known as the request for streaming (RFS), was on simulating spot FX trades for the USD/SGD currency pair. However, the underlying solution has the potential to be extended to trading any currency pair, offering a versatile solution for the foreign exchange market. It’s important to note that the application is currently in its trial phase and not yet available to clients.
Private Permissioned Avalanche Evergreen Subnets for Enhanced Functionality
To capture price quotes and simulated trade confirmations specific to each counterparty, Citi utilized private permissioned Avalanche Evergreen Subnets. These subnets are tailored to meet institutional requirements, taking into account company-specific and industry-wide considerations. The Evergreen Subnets offer a host of customizable features, including EVM compatibility, permissioned validation, smart contract deployment, transaction levels, network privacy, and custom gas features. By leveraging these advanced capabilities, Citi ensures that the application meets the specific needs of its institutional clients.
Transforming Legacy Capital Markets with Blockchain Technology
The adoption of blockchain, smart contracts, and tokenization is gaining traction as a means to enhance the infrastructure and workflows of legacy capital markets. Ava Labs’ Evergreen Subnets, including the one deployed for Citi’s Project Guardian initiative, play a pivotal role in this transformation. These subnets enable financial institutions to explore the potential of on-chain finance, with Spruce, an Evergreen Subnet, already attracting participation from prominent Wall Street firms such as WisdomTree.
Achieving Interoperability with Avalanche’s Native Features
Ava Labs’ Avalanche blockchain offers native intranetwork interoperability, which was leveraged in Citi’s Project Guardian initiative. This interoperability is crucial in a connected ecosystem and eliminates the need for third-party bridges or trust assumptions. Avalanche Warp Messaging (AWM) emerges as a compelling network feature, enabling seamless interoperability and facilitating efficient communication between different components of the blockchain network.
The Ideal Platform for Building On-Chain Applications
John Wu, President of Ava Labs, expresses excitement about the adoption of Avalanche by leading financial institutions, stating, “Avalanche’s rapid pace, scalability, and adaptability position it as the optimal platform for constructing on-chain applications tailored to fulfill institutional requirements.” The combination of these key attributes positions AvaCloud’s blockchain service as a powerful tool for driving innovation and addressing the unique requirements of the foreign exchange market and broader capital markets.
Ava Labs’ AvaCloud, the managed custom blockchain service, has empowered Citi in testing an innovative on-chain application for simulated spot foreign-exchange trades. Through the utilization of private permissioned Avalanche Evergreen Subnets, Citi has been able to capture real-time price quotes and record simulated trade executions securely on the Avalanche blockchain. The collaboration between Ava Labs, Citi, and other financial institutions within Project Guardian demonstrates the transformative potential of blockchain technology in improving legacy capital markets’ infrastructure and institutional workflows.
The unique features offered by AvaCloud, including EVM compatibility, permissioned validation, and network privacy, enable institutions to explore the benefits of on-chain finance and drive innovation in the financial industry. With native interoperability and advanced features like Avalanche Warp Messaging, AvaCloud stands at the forefront of blockchain solutions, catering to the evolving needs of financial institutions worldwide.
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