The venture arm of XDC Network, a layer-1 blockchain, announced on Wednesday its acquisition of Contour Network, a digital platform aimed at helping banks streamline trade finance using blockchain technology.
Originally supported by prominent banks such as HSBC, Citi, and Standard Chartered, Contour faced challenges in scaling and was shuttered at the end of 2023. Under the ownership of XDC, it will undergo restructuring with a fresh capital injection, a renewed strategy, and an emphasis on integrating stablecoins into real-world trading processes, according to a press release shared with CoinDesk.
The firm did not disclose the purchase price.
This acquisition coincides with a global push from banks and financial institutions to explore the use of blockchain for real-world asset (RWA) tokenization and stablecoin settlements. A report by Ripple and BCG earlier this year suggested that this approach could save billions annually in trade financing by automating processes through smart contracts and programmable digital payments on blockchains.
As an Ethereum-compatible layer 1 with two-second settlement times and support for ISO 20022 messaging, XDC Network is positioning itself as a hub for RWA tokenization. Its partners include notable firms such as Circle (CRCL), Deutsche Telekom MMS, and Securitize, with the network also integrating frameworks like MLETR and R3 Corda to facilitate cross-border finance.
“Banks require settlement rails, treasury optimization, and compliance frameworks,” stated Ritesh Kakkad, co-founder of both XDC Network and XDC Ventures. “We are developing all three.”
Contour focused on digitizing Letters of Credit, a financial instrument banks utilize to secure trade agreements. Its system has previously reduced processing times from days to hours during live trades, according to the firm. Leveraging this platform, XDC intends to provide comprehensive digital trade finance that ranges from documentation to real-time settlement. The project aims to start testing with regulators in the U.S., EU, and Asia as part of its next phase, XDC noted.
Along with the acquisition, XDC Ventures introduced a Stablecoin Lab designed to conduct pilot programs targeting banks and corporations. These initiatives will assess how regulated stablecoins like Circle’s can be utilized for more efficient trade transactions compared to traditional methods.
Read more: Brazil’s VERT Capital to Tokenize $1B in Real-World Assets on XDC Network
