Ana Botín, president of Banco Santander, believes that the tokenization of finance is happening and will accelerate.
Tokenization, according to Botín, allows for the rapid, secure and automated execution of business and financial processes with lower transaction costs and risks.
Botín made this reflection on her Instagram profile in connection with Santander’s participation in the world’s first operation involving live transactions representing digital funds held in a central bank. The operation was carried out through Fnality, a consortium of financial institutions of which Santander is a part, which is building a regulated payment system for the tokenized asset and markets industry. The president of the bank of Spanish origin described the operation as an important milestone, because it “could change how the pipes of the financial system work forever.”
Fnality reported that the aforementioned operation, in addition to Santander, involved Lloyds Bank and UBS. “The first live transactions between LLoyds, UBS and Santander were made using a digital representation of funds (i.e. a token) at the Bank of England,” Botín describes.
Botín explains that Santander has been at the forefront of testing new technological capabilities, such as issuing bonds on the Ethereum network. Santander was the first entity to issue the first bond with blockchain technology from start to finish. It was in September 2019. The bond, worth $20 million, was kept on the blockchain until its maturity, thus opening the possibility of a secondary market for tokenized securities. The president of Santander considers that collaboration between governments, central banks and the financial system, as has happened in the aforementioned transaction, is decisive to meet the needs of the new era of the high-tech industry.
Banco Santander also proposed this year to trade cars and houses with NFTs in Brazil. Banco Santander has used blockchain technology to tokenize traditional market assets. Last year it reported a partnership with the Argentine platform Agrotoken to support loans with tokens related to agricultural commodities. Like soy, corn or wheat. Like BBVA, Santander already offers its clients in Switzerland investment and trading services for bitcoin and ethereum.