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Zurich-based financial services company Credit Suisse and Amsterdam-based ING Group announced in a press release that they have successfully transferred a financial product worth 25 million euros between themselves using blockchain technology.

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In a development that the release called “groundbreaking”, legal ownership of Dutch and German government securities were swapped between the two financial services companies, “while the underlying securities remained static within unique DCR-linked custody accounts”.

The activity was executed on the R3 Corda blockchain using an application created by a company called ‘HQLAX’.

The reason that this is new is because usually such transactions involve actually transferring the underlying securities, which can take days. On this occasion, the only things transferred were ‘digital collateral records’, created by HQLAx, which are linked to the relevant accounts. The transaction was completed instantly.

Guido Stroemer, CEO of HQLAX, commented, “HQLAX is very fortunate to have the strong support of the banks active in our platform design and build. In particular, I would like to thank Credit Suisse and ING for their enthusiastic participation in this meaningful pilot transaction, which is a significant step towards helping market participants exchange collateral more efficiently using the HQLAX platform.”

David E. Rutter, CEO of R3, commented, “Collateral lending is a great example of a process that can be revolutionised by blockchain technology, and this live trade between two major global banks marks a significant milestone for the market. We look forward to continuing our work with HQLAX and the banks to establish Corda as the de facto platform for high quality liquid asset management.”

Romain Dumas, Head of Rates Repo and Collateral Optimization at Credit Suisse Securities (Europe) Limited, said, “The success of this first live transaction speaks to the potential for blockchain technology to help improve collateral fluidity by creating a more efficient, transparent, and cost effective marketplace for liquidity transfers.”

Ivar Wiersma, Head of Wholesale Banking innovation at ING, commented, “This transaction proves the progress we are making towards deploying Distributed Ledger Technology for the benefit of our clients and society by making the financial industry more efficient and more resilient. With this strong group of participants, together with ING’s technical contribution, I’m confident about the path to production of the HQLAX platform.”

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