Alibaba’s global business-to-business platform is set to streamline cross-border payments by using tokenized versions of major currencies, marking a significant shift toward blockchain-based settlement in global commerce.
Kuo Zhang, president of Alibaba.com, told CNBC that the platform plans to start using tokenized deposits backed by fiat currencies such as the U.S. dollar and euro. This new technology, developed in partnership with JPMorgan, aims to speed up transactions and reduce the number of intermediaries involved in international payments.
Currently, in cross-border trade, a U.S. buyer sending dollars to a Chinese supplier often sees funds routed through multiple banks and undergo several currency conversions. This process adds both time and increased costs. With tokenized currency, a digital version of that dollar could be transferred directly over a blockchain-based system, bypassing these intermediaries altogether.
Alibaba.com will utilize JPMorgan’s blockchain-based JPMD infrastructure, a system designed to facilitate the movement of tokenized deposits between institutional clients. Unlike stablecoins—which are usually issued by non-banks and backed by assets like treasuries—tokenized deposits sit directly on a regulated bank’s balance sheet.
Zhang also mentioned that Alibaba.com is exploring the possibility of adopting stablecoins in the future. However, the initial focus will remain on bank-issued digital tokens to ensure regulatory compliance and operational clarity.
This move by Alibaba highlights a growing trend in leveraging blockchain technology to enhance efficiency and transparency in global commerce and payment systems.
https://bitcoinethereumnews.com/blockchain/alibaba-to-use-jpmorgans-blockchain-for-tokenized-dollar-and-euro-payments-cnbc/
