While the banking industry has been one of the most hostile industries when it comes to blockchain technology and Bitcoin in the early stages – that hasn’t stopped them from taking over some sizeable corner of the market for their own.
An increasingly substantial number of financial companies, being headed up by the multinational UBS Group AG have been setting their sights firmly on the application of blockchain technology in the aid of creating a streamlined, low-cost and high efficiency cross-border trading solution, powered by its own blockchain and its own ‘Bitcoin’ token.
Among the financial institutions involved in this ambitious project includes – Barclays, Nasdaq, Credit Suisse Group, Banco Santander, ING, and Lloyds Banking Group. Each of these have since registered themselves as part of a collaborative entity, with more to potentially join.
Each of these organizations will be involved in the development of a unique token, known as a ‘utility settlement coin’ or a USC, according to an international news source.
More than just placing a tenuous interest in this cross border payments solution, these financial behemoths have since officially poured more than 60 million dollars into this international organization – known more broadly as Finality International.
It doesn’t come as too much of a surprise, considering that this token has been in steady development for more than 4 years, and will serve as a joint payment device as well as a “messenger that carries all the information required to complete a trade,” according to the report.
This new kind of permissioned blockchain solution will attempt to significantly reduce the kind of risks associated with cross border payment solutions, while also increasing the speed in which they are completed. According to the UBS head of investment strategy – Hyder Jaffrey discussed the kind of benefits that this solution would provide –
“You remove settlement risk, the counterparty risk, the market risk,” Jaffrey continues. “All of those risks add up to costs and inefficiencies in the marketplace.”
Along with the more than 14 international financial companies previously mentioned, some of the newer partners to this cross-border solution include major national banks such as Bank of New York Mellon Corp., Canadian Imperial Bank of Commerce , State Street Bank & Trust Co., Commerzbank AG, KBC Group NV, Mitsubishi UFG Financial Group Inc., and Sumitomo Mitsui Banking Corp.
Each of these major banking institutions has since announced that they will be making use of the USC token in the foreseeable future.
According to reports, this platform is forecasted to launch worldwide within the next 12 months, which is further substantiated by previous reports which suggested that it would be put completely into action as of 2020.
While this represents one of the more ambitious, globe-trotting projects from financial institutions – there is no inkling whether or not USC provides more utility and represents something resembling a cryptocurrency more than JP Morgan’s token does, however.