Consensys launches bank settlement across blockchains without bridges

Consensys interoperability for banks now has a product: Sovereign Network Interoperability lets institutions settle trades across separate blockchains while each asset stays on its own ledger, Cryptonews reported. Consensys showed it at Devcon in Mumbai on 2 November.

The product targets banks, custodians, asset managers and financial market operators that run separate digital systems for payments and securities. It arrives weeks before Consensys finishes splitting off MetaMask, its consumer wallet business.

Four uses

• securities settlement, where a tokenized security moves on one ledger and the payment on another (delivery versus payment);
• currency swaps between banks on terms agreed before settlement (payment versus payment);
• collateral transfers with clearinghouses and approved counterparties;
• fund servicing, where treasurers park idle cash in tokenized money market funds and redeem it outside banking hours.

No bridge in the middle

Consensys calls the design bridgeless. A bridge locks an asset on one chain and issues a wrapped copy on another, and the copy is only as safe as the contract holding the original. Here the assets stay put. The Cross Ledger Interoperability Protocol (CLIP) coordinates the deal and checks with cryptography what happened on each ledger. Consensys says CLIP draws on a decade of its zero-knowledge proof research.

An institution sets its requirements and the counterparties it accepts. The software picks an approved route, coordinates the steps on each ledger and reports whether the deal completed, failed or needs a person to step in. The institution decides who takes part, what data they see and which transactions they may approve.

You can run the product in-house, go through a market infrastructure provider or buy it as a managed service. Consensys says it will handle compatibility testing, updates, security fixes and recovery procedures.

Now and later

EVM-compatible networks work today. Canton support is planned without a date, as is support for the Ethereum Economic Zone standard and the IBC protocol. Consensys did not disclose pricing, volumes or named production clients.

“We are bringing deep protocol expertise, transaction coordination and complete support into one product,” said David Cunningham, president of Consensys.

The split with MetaMask

In September Consensys said it would split in two. MetaMask becomes an independent consumer company under Joe Lubin. A new Consensys keeps the Ethereum protocols and institutional software, run by CEO Mike Kriak and president Cunningham. The separation should finish before the end of 2026. Back in July Consensys had put its IPO plans on hold.

The institutional side already has a partner: on 8 October Consensys and ClearToken agreed to build round-the-clock settlement for tokenized securities and cash. Hong Kong banks already run tokenized settlement 24/7 through Project Ensemble, so Consensys enters a field where banks have working options.

Consensys has not named production clients or volumes; the description of how the product works comes from the company.