BankChain Project Launches Blockchain Exchange for Stressed Assets

The India-based consortium has launched a blockchain-based exchange for trading non-performing assets.

AccessTimeIconApr 2, 2018 at 12:45 p.m. UTC
Updated Sep 13, 2021 at 7:46 a.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Primechain Technologies, a Mumbai-based startup that operates India's BankChain consortium, has launched a blockchain system for the trading of so-called "stressed" assets.

The project, built on a blockchain called Primechain-ASSET, will see the creation of an exchange for selling and buying stressed assets, said Sudin Baraokar, innovation adviser at State Bank of India, a member of BankChain.

Stressed assets include non-performing assets (NPAs), restructured loans, assets under reconstruction and written-off assets.

Allowing banks to divide up stressed assets and sell them to other banks, asset reconstruction companies or funds, the blockchain platform comprises a smart contract-powered auction system, built-in regulatory reporting and other features. The blockchain will also offer a repository for documents related to the assets, according to the release.

Baraokar continued:

"This [project] will help banks get a more data and market-driven price discovery of stressed assets and will automate and bring a more orchestrated effort for sale of Non-Performing Assets (NPAs). By leveraging blockchain, we can then continue to develop more structured products once we have a Loan Asset Exchange system in place."

NPAs have come into limelight recently, as an observed decline in asset quality has been touted as an economic risk for banks.

"Stressed assets have become a multi-trillion dollar challenge for the global banking sector. The gross non-performing assets of the banks in India are over Rs. 8 lakh crore [$123 billion]," Shinam Arora, CEO of Primechain, said in the statement.

Also addressing the issue, the Reserve Bank of India last month issued a reassessed framework for banks, allowing early detection and identification of stressed assets.

Graph image via Coindesk archives

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.