According for news reports A recent issue reports that major banks in Argentina are experimenting with a new blockchain-based system that will empower banks among themselves, and which will also form the basis for the new clearing system between banks and the Argentine Central Bank.

The new news was revealed by the blockchain development team, IOV Labs, on Tuesday.

Argentina is looking for a new alternative to the clearing system based on blockchain technology:

With regard to the nature of clearing and a brief overview about it, it means exchange, meaning that each bank has a room in the central bank called the clearing house, and an employee from each bank is appointed to carry out this task. They accepted other local bank clients in their accounts with the Central Bank.

Read:Big Demand for Blockchain ETFs According to New Report

Returning to our topic, IOV Labs specializes in developing financial solutions on the blockchain, and noted that the new blockchain system was created in cooperation with BCRA, the Argentine Central Bank, and other large banks in the country, including BBVA.

The blockchain system is based on the “RSK Smart Contract Network” and is being tested by the Central Bank.

The primary goal of the new blockchain system is to enable more convenient and instant payment with fiat currencies with improved traceability.

Executive Director of the Development Team Diego Gutierrez Zaldaviar believes that a blockchain-based clearing system will enable a fully collaborative financial system, and is expected to allow banks in the country to walk in parallel with recent technological developments towards a more favorable financial ecosystem.

Blockchain is a guarantee of system improvement:

While Diego emphasized the need for a blockchain system, there is an urgent need for technologies such as blockchain to improve operations and to better improve the user experience, especially during the current global situation.

Participants in the new blockchain system will mainly consist of clearing houses, financial institutions and the central bank.

Another goal of the initiative was to further clarify the technology’s use case, according to the report.

Read:More controversy over the Terra project after the proposal was amended in the middle of the voting process

BCRA is always looking for potential opportunities from blockchain technology, and its movement today tends to point to other applications of the blockchain outside of cryptocurrency, which appears to be a well-known use of the blockchain.

Argentina’s central bank has recognized that crypto is somewhat risky.

As of 2014, Argentina’s Central Bank warned residents in the country to refrain from using cryptocurrencies as legal tender, especially Bitcoin.

Read also:

Air Asia unveils a cargo shipping system based on blockchain technology

China’s national blockchain platform will be compatible with EOS and ETH nodes