XDC Network Acquires Contour to Expand Stablecoins and Tokenization in Trade Finance

Layer-1 blockchain XDC Network’s venture arm said on Wednesday it had acquired Contour Network, a digital platform designed for banks to streamline trade finance with blockchain rails.

Contour was originally backed by major banks like HSBC, Citi and Standard Chartered but struggled to scale and was shuttered in late 2023. Under XDC’s ownership, it will be restructured with fresh capital injection, a revamped strategy and a focus on integrating stablecoins into real-world trade processes, XDC said in a press release shared with CoinDesk.

The firm did not disclose the acquisition price.

The acquisition comes as global banks and financial institutions ramp up efforts to explore using blockchain rails for real-world asset (RWA) tokenization and stablecoin settlements. The process could save billions of dollars annually in trade financing alone by automating processes with smart contracts and programmable digital payments on blockchains, a report by Ripple and BCG from earlier this year projected.

XDC Network, an Ethereum-compatible layer 1 with two-second settlement times and ISO 20022 messaging support, is positioning itself as a hub for real-world asset tokenization. Its partners include Circle (CRCL), Deutsche Telekom MMS and Securitize, and the network has integrated frameworks like MLETR and R3 Corda to support cross-border finance.

“Banks need settlement rails, treasury optimization and compliance frameworks,” said Ritesh Kakkad, co-founder of XDC Network and XDC Ventures. “We’re building all three.”

Contour specialized in digitizing Letters of Credit, a type of financial instrument that banks use to guarantee trade deals. In past live trades, Contour’s system helped reduce processing times from days to hours, the firm said. Leveraging the platform, XDC aims to offer end-to-end digital trade finance from documentation to real-time settlement. The project will begin testing with regulators in the U.S., EU and Asia as part of its next phase, XDC said.

With the acquisition, XDC Ventures also unveiled a Stablecoin Lab to run pilot programs aimed at banks and corporates. These pilots will test how regulated stablecoins such as Circle’s USDC$0.9999 can be used to settle trade transactions on a blockchain more efficiently than traditional rails.

Read more: Brazil’s VERT Capital to Tokenize $1B in Real-World Assets on XDC Network