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Citbank’s 900 million reasons to use smart contracts

 

In case you’re not clear about the risks of manual administration of private market ‘alternative’ investments – a smart contract could have saved Citibank from a $900m mistake earlier this week.

Citibank is administrating Revlon’s $1.8B loan from a syndicate of private investors. They (maybe) meant to send out the latest interest payment but wired $900m in error.

That’s not a typo – and Citibank is having to sue to get close to $400m of it back.

Payments like this can be fully automated in a smart contract based private credit agreement.

It seems that Citibank has almost a billion reasons to start thinking about a better way to do this.

Bloomberg article after the jump