In a recent revelation, TASCOMBANK, a major Ukrainian commercial planning on the use of blockchain technology following the completion of a pilot. The bank used the Stellar network in the pilot and noted several advantages.
Notably, TASCOMBANK is one of the oldest commercial banks in Ukraine and has recommended using blockchain technology after using the Stellar (XLM) network for an electronic money pilot. In addition, the bank conducted a pilot related to decentralized technology and recommended the “adoption of to transform the payment landscape of Ukraine.”
Stellar, or Stellar Lumens, is an open-source, decentralized protocol for digital currency to fiat money low-cost transfers which allow cross-border transactions between any pair of currencies.
TASCOMBANK conducts several banking activities, including consumer and corporate lending, factoring, electronic commerce, acquiring, and trade operations financing. The pilot project was launched with the support of the Ministry of Digital Transformation.
Following the completion of the pilot, the bank issued a report providing information to the National Bank of Ukraine and the Ministry of Digital Transformation of Ukraine. The report listed several advantages of decentralized technology, including greater transparency, accountability, improved security, confidentiality, low transaction costs, instant payments, and high throughput.
The pilot first started in 2021, with the intention to test the technology to implement better and more efficient payment systems in the country. Sergii Kholod, the Deputy Chairman of the Board of TASCOMBANK, said that the project was a way to explore a new way of issuing and managing electronic money. The project’s outcome opened the future for blockchain in the banking sector.
In his words:
“As part of a pilot project, we explored a new way of issuing and managing electronic money, which could be a new generation of payment for the citizens and organizations of Ukraine, their employees and clients, government institutions, and international organizations. The results of the pilot project presented the openness of the bank’s infrastructure to blockchain solutions in the future.”
Ukrainians have found a major relief in crypto as they are struggling to protect themselves from thriving against the war with Russia. In August, Ukrainian vice prime minister Mykhailo Fedorov revealed how $54 million in cryptocurrency donations had been used.
The donations were processed by Aid For Ukraine, a nonprofit supporting humanitarian efforts and the Ukrainian Armed Forces, and powered by cryptocurrency exchange FTX, Everstake, Kuna, and the Ministry of Digital Transformations of Ukraine. The crypto community was highly applauded and appreciated for their support since the start of the invasion.
Recently, the United Nations High Commissioner for Refugees (UNHCR) also collaborated with Stellar to pilot a digital cash disbursement system to help Ukrainians in need. As a result, stellar will instantly focus on developing the pilot of the “Stellar Aid Assist” project to deliver the UN’s aid to those in need.
Interestingly, the integration of decentralization in the traditional banking system has not only been attempted by TASCOMBANK. For example, in November last year, J.P. Morgan, a multinational bank, collaborated with the central bank of Singapore to attempt its first-ever decentralized finance (DeFi) transaction.
The Monetary Authority of Singapore (MAS) said that the transaction was one of the many to announce the commencement of Project Guardian. The regulator said that the pilot program’s goal is to identify the potential use cases of DeFi applications in the financial markets. Additionally, it was an asset tokenization and international transfer experiment.