Allianz, the financial service conglomerate based in Germany is now in the advanced stages of developing the Allianz blockchain token ecosystem. This blockchain token ecosystem focuses on easing cross border issuance settlements for Allianz’s corporate clients. The new payment ecosystem will feature a native Allianz cryptocurrency or token pegged to the U.S dollar at a 1:1 ratio. By adopting this approach, Allianz is following in the footsteps of the U.S based JP Morgan, which announced its stablecoin called the JPM coin back in February.
According to a spokesperson for Allianz:
“AGCS is further exploring blockchain technology to simplify and accelerate cross-border insurance payments for its corporate customers. A project team is in the advanced stages of development for a token-based electronic payment system to allow for frictionless, transparent, and instantaneous money transfers for a range of different types [of]payments.”
Allianz Blockchain Token Ecosystem
Allianz has not always been a fan of cryptocurrencies. The CEO of Allianz Global Investors Andreas Utermann once called for the ban of cryptocurrencies. However, the company’s position seems to have changed. It is now creating a native cryptocurrency to govern the Allianz blockchain token ecosystem. This “corporate token” is expected to help loosen up the rigidity that currently slows down global money transfer to Allianz’s institutional clients. Allianz has reportedly created an exclusive blockchain network specifically dedicated to achieving this aim.
The business insurance branch of the company, Allianz Global Corporate & Specialty (AGCS) has already tested the core infrastructure of this new system. The next step in the development of this blockchain token ecosystem involves test trials. By using a native stable coin, Allianz will be able to tremendously improve the speed of global insurance payments and reduce clog. This approach will bring about a whole new level of service efficacy and instantaneous payments.
The Rise of Corporate Tokens
Blockchain technology, specifically the creation of ‘corporate tokens,’ is gradually becoming a growing trend amongst big corporations around the globe. The competition is growing fierce. These organizations seek to enhance their value transfer systems. They create new business opportunities by leveraging the growing popularity of digital currencies.
JP Morgan Entering the Fray
With JP Morgan launching its native stable coin, other corporations are now investigating blockchain technology and the merits of tokenization. For example, Walmart has recently filed a patent which indicates plans to launch a USD-pegged stablecoin to help low-income families who cannot afford banking services. Goldman Sachs is also thinking along the same lines. Several reports indicate that the investment bank is making new hires to help pursue its goal of developing a native stablecoin.
However, the most controversial of these corporate tokens belongs to social media giant, Facebook. Facebook has announced its plans to launch its cryptocurrency called Libra under the auspices of the Libra Association consisting of 28 members handpicked by Facebook. Based on the description of this cryptocurrency, Libra is a fully centralized token. It can integrate into all payment faucets with connections to the Libra Association. The centralized nature of this cryptocurrency will allow the Libra Association to become more powerful than a Central Bank. Likewise, they will have the ability to create and even destroy Libra at will.
Future of Corporate Tokens
Corporate tokens bring many advantages to the table; they make global transactions easier and faster. They could even help the poor create better financial alternatives due to flexibility and a lower entry barrier. However, because of how centralized corporate tokens are, many worry about how some large corporations being too powerful. Arguably, they will have some much influence over the global financial system without any checks and balance. Many politicians have expressed a similar sentiment. So far, the government has been unable to provide proper regulation for corporate tokens.