Sberbank and Interros Group have conducted an over-the-counter OTC foreign exchange repurchase agreement (repo) transaction with the use of smart contracts on a blockchain.
This is according to a report made by Reuters Russia.
The Interros Group is a private equity firm that is based in Moscow, and established by Russian oligarch Vladimir Potanin in 1990, with stakes in Norilsk Nickel, pharmaceutical company Petrovax Pharm, and ski resort development company Rosa Khutor.
Head of global markets department and vice president at Sberbank, Andrei Shemetov, conveyed that the transaction is genuine, legally binding, and has been “concluded in electronic format using a smart contract and digital signatures through the IT platform of Sberbank.”
The report also cites that while Shemetov “did not disclose the scope of the transaction,” he “indicated that the amount corresponded to the average volume of the interdealer repo transaction.”
Shemetov also explained that “the transaction is a currency repo secured by the pledge of Eurobonds of the Russian issuer of the first tier.” He also defined how blockchain would augment the services that are being offered by Sberbank:
“In the long term, the conclusion of transactions through the blockchain platform will reduce transaction costs and errors through automation, as well as increase transparency and trust among all participants in the financial market.”
Reuters reports that Shemetov cited “the creation of a software environment with the ability to audit data on a bilateral basis” and “automation of settlement and operational functions” as advantages of blockchain-based repo transactions.
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