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The Signature Bank is launching a payment platform for its institutional clients that will be powered by the permitted version of the Ethereum blockchain. The initiative known as the Signet Platform allows customers with Signature Bank to transfer funds in 30 seconds, 24 hours a day, seven days a week, converting USD into Ethereum ERC-20. Although this initiative is limited to Signature customers only, it is part of the transition to the commercial bank to connect directly to third parties without an intermediary.
Blockchains are now adopted to simplify Office workflows in a number of industries
Originally disseminated for the use of bitcoins without considering the needs of banks, blockchains are now being pursued as a way to simplify different middle and back-office workflows in the banking sector and in other sectors. Unlike other Ether tokens that also meet the ERC-20 standard, the Signature Bank seals are designed to work only on the bank's Signet platform. However, trueDigitital in a statement indicated that this is the first step in an offer to add other currencies and pairs. Ethereum Price (ETH) today – ETH / USD
Signet platform to be launched on January 1st of next year
The Signet platform will be open to commercial customers with Signature Bank as of January 1, 2019. After the launch, the transactions will initially be free, but the minimum required balance will also be $ 250,000. All deposits held in the Signet platform will be eligible for FDIC insurance, which will correspond to the legal insurable sums defined by the FDIC. Since the platform will be limited to the customers of the Signature Bank, all users must pass the anti-money laundering policy stipulated by the bank and the KYC (know-your-customer) compliance.
The Signature Bank was launched in May 2001. It generated $ 155.4 million in net income for the third quarter of 2018 and now manages up to $ 45 billion in assets.
Signet received regulatory approval
Also announced today, the Signet Platform has received approval from the New York State Department of Financial Services. This makes the first bank obtain regulatory permission to implement Blockchain technology in this capacity. Although the service will be free at launch, the company is considering how to monetize the service.
The launch of Signet is not the first time that the true founder of Digital Holdings has made headlines. Before joining a partnership with Signature Bank, the founder of trueDigital Sunil Hirani launched Digital Asset Holdings, a startup that raised $ 107 million in venture capital. He is known for winning a contract to help ASX (Australian Securities Exchange) replace his CHESS register for titles.
In addition, Swift explored the Blockchain initiative, although it initially considered the technology not ready for the heavy volumes the workload needs. There is more competition coming from XRP, a venture-venture network that uses its distributed proprietary register that is similar to the allowed version of Ether. While XRP is designed to exploit its XRP digital currency in order to increase liquidity, Signet is not interested in exploiting cryptography directly anytime soon.
Going forward, banks are more likely to provide such an in-bank payment solution that can simplify or simplify back and middle-office workflows before connecting directly with each other.
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