Regulated Liability Network (RLN)
Multi-bank tokenized deposit network with central-bank-money interoperability. Citigroup-led consortium exploring shared settlement of commercial bank money, central bank money, and regulated non-bank digital money on a common ledger.
Step 1 · Member Identity (Bank-Grade Onboarding)Policy-Enforced
"An institutional client onboarded to a major correspondent bank — bank-grade due diligence, beneficial-ownership disclosure, ongoing-monitoring program, attested before any RLN access."
Each RLN participating member (Citi · HSBC · Mastercard · BNY Mellon · TD · US Bank · Truist · Wells — VERIFY current roster) completes the consortium's institutional onboarding before joining the network. The onboarding satisfies bank-grade KYB on the member entity, beneficial-ownership disclosure (31 C.F.R. § 1010.230), and attestation of the member's own BSA/AML program.
Member-customers (corporate clients of the participating banks) inherit identity attestation from their respective banks' existing CIP files. RLN does not run customer-level CIP at the consortium layer; the participating bank does.
L4 ACCOUNT (member-customer wallet eligibility) and L5 APPLICATION (consortium onboarding + per-bank CIP) lit, policy-enforced.
Step 2 · Liability-Class Selection (Multi-Asset Negotiation)Policy-EnforcedINGESTDETECTALERT
"A correspondent banker selecting the cash leg currency for a cross-border settlement — except the choice is between commercial bank money, central bank money, or regulated non-bank digital money rather than between USD and EUR."
RLN's multi-liability architecture means the originating member must select which liability class denominates the settlement: commercial-bank money (member-bank deposit liability), central-bank money (Fed reserve-account leg — VERIFY production-stage availability), or regulated non-bank digital money (regulated stablecoin issuer liability).
The choice has settlement-finality, prudential, and tax implications: central-bank-money settlement carries sovereign-risk-free finality but requires Fed-leg eligibility; commercial-bank-money carries the issuing bank's credit exposure; regulated-non-bank settlement carries the stablecoin issuer's reserve-backing exposure.
L5 APPLICATION lit, policy-enforced. C13 (market integrity) attaches because the liability-class choice is disclosed to the receiving counterparty — a misstated liability class would create operational exposure for both members.
Step 3 · Multi-Party Authorization (Atomic Swap Setup)Mixed EnforcementINGESTDETECTALERT
"A multi-party DvP settlement message that requires affirmative sign-off from each leg's holder — except the legs are different liability classes on a single ledger."
RLN's atomic-swap primitive requires authorization from each liability holder participating in the settlement. For a commercial-bank-money payment: originating bank, receiving bank, and (if the central-bank-money leg is involved) the Federal Reserve all sign affirmatively before the swap fires.
Sanctions screening runs at the originating-member layer (NICE Actimize · Verafin · SAS — VERIFY member-by-member); on-chain enforcement gates the settlement contract on the multi-party signature requirement.
L3 EXECUTION (multi-party signature gate) and L5 APPLICATION (per-member compliance pipelines) lit. Mixed enforcement: bank-side sanctions screening is policy-enforced, on-chain signature gate is code-enforced. C9 (prudential) attaches at every participating bank because the swap changes intraday-liquidity positions.
Step 4 · Atomic Multi-Liability Swap (RLN Ledger)Code-Enforced
"An RTGS settlement that simultaneously moves cash legs across multiple central-bank accounts — except on a shared ledger with multiple liability classes coexisting."
The RLN settlement contract executes the atomic multi-liability swap. All legs commit together: originating member's commercial-bank-money debit, receiving member's commercial-bank-money credit, and (if applicable) the central-bank-money or regulated-non-bank-digital-money legs.
Liability class is preserved cryptographically through the swap — a token tagged 'commercial-bank-money' cannot be silently converted to 'central-bank-money' without an explicit Fed-leg signature. This protocol-level liability-class integrity is the substrate's defining property.
L1 NETWORK · L2 CONSENSUS · L3 EXECUTION · L4 ACCOUNT all lit. Final on RLN consensus per the SETL ledger engine's BFT round [VERIFY exact algorithm and latency target]. C13 (market integrity) attaches because liability-class integrity is load-bearing for the settlement guarantee.
Step 5 · Sovereign-Leg Oversight (Fed Touch Point)Policy-EnforcedINGESTDETECTALERT
"A Fedwire settlement passing through the Fed's central settlement infrastructure — except the Fed leg is one of three liability classes on a shared ledger rather than a distinct messaging rail."
Settlements involving the central-bank-money leg touch Federal Reserve infrastructure. The Fed's role at the model's January 2026 cutoff is observer (per the 2022–2023 NY Innovation Center PoC); production-stage Fed participation as a liability holder carries VERIFY.
When the CBM leg is live, the Fed's leg-signature primitive participates in the multi-party authorization (cf. step 3) and the Fed's reserve-account books reflect the settlement. Sovereign oversight attaches: every CBM-leg settlement is observable to the Fed and the OCC for participating national banks.
L5 APPLICATION lit, policy-enforced. C10 (operational resilience) attaches because the Fed leg introduces dependence on Fed operational uptime — RLN settlements involving the CBM leg cannot complete during Fed-side outages.
Step 6 · Settlement Reporting & Multi-Class RecordkeepingPolicy-EnforcedINGESTDETECTALERT
"Settlement-record archives at a multi-currency clearing house — each currency leg's record is preserved alongside the integrated settlement record."
Each settlement's record preserves the liability-class composition: the on-chain transaction hash anchors the multi-class swap, and each participating liability holder's books reflect their leg of the settlement.
Recordkeeping satisfies C11 obligations at every participating bank under existing 12 C.F.R. §§ 12.1, 12.3 (records of account); the cryptographic on-chain record satisfies C12 (independent audit trail). Cross-class reconciliation (e.g., commercial-bank-money debit at originating bank reconciles to central-bank-money credit at Fed leg) is the canonical end-of-day reconciliation primitive.
L5 APPLICATION lit, policy-enforced. The single canonical record across all participating books is the operational simplification — multi-leg reconciliation that traditionally requires per-bank-per-currency book matching collapses to one ledger query.
Resolved 6 steps across 1 chain(s). 0 threshold(s) triggered. Frameworks: Common Reporting Standard / FATCA.
Coverage notes: 5 disclosed gap(s).