Banks are falling for crypto: Goldman Sachs and BNP Paribas finance Fnality

Blockchain is shaking up the world of finance. Traditional banks have understood this and are investing massively in this promising technology, like Goldman Sachs and BNP Paribas who have just injected $95 million into the startup Fnality.

Goldman Sachs and BNP Paribas light the fuse of the crypto revolution with Fnality

Goldman Sachs and BNP Paribas led this second round of financing, in which other heavyweights in the banking and financial sector participated. We can cite Euroclear, DTCC, WisdomTree, as well as historic investors in Fnality such as Nomura, Banco Santander or Barclays.

According to a report from Reuters on November 13, Fnality raised £77.7 million ($95 million) on this occasion. The total funds raised by the company since its inception in 2019 now stand at $158 million.

Fnality’s objective is to establish a global liquidity management network operational 24 hours a day. This involves supporting the emergence of new digital payment models, by allowing financial institutions to easily use central bank currencies (CBDC) for transactions involving crypto assets or cross-border payments for example.

Enough to compete with the venerable SWIFT, a veritable dinosaur of interbank transfers, which has not undergone any major development since its creation in the 1970s. In any case, this is the bet of Fnality and the 14 other shareholder banks, such as Barclays. , ING or Credit Suisse.

A revolution in interbank payment systems

Fnality’s project is ambitious, but promising: it involves replacing the current interbank clearing system, considered slow and costly, with a significantly more efficient blockchain network. Stablecoins backed by major currencies will facilitate near-instant transfers between financial institutions.

A first version of the system, called USC (Utility Settlement Coin) and based on Ethereum, has already been the subject of a convincing proof of concept in early 2022. From now on, Fnality intends to accelerate the movement and quickly obtain the necessary authorizations from regulators, notably the Bank of England. Its objective is an operational launch in 2023.

Many banks like Goldman Sachs or BNP Paribas are banking on this innovation to adopt blockchain, like JPMorgan and its programmable payment solutions.

Thanks to its record fundraising, Fnality has the necessary resources to realize its ambitious project. Supported by leaders in the banking sector, the crypto startup seems in a good position to revolutionize the finance of tomorrow through blockchain, subject to approval from regulators.