- UBS-led project will go online within a year.
- The developed token will reduce transaction processing time and allow to slash fees.
The Swiss-based banking holding UBS announced the launch of a digital token for cross-border settlements. The project is realized in partnership with 14 large financial institutions, including British Barclays, US-based stock exchange Nasdaq, Swiss Credit Suisse and German Commerzbank.
UBS, the leader and the owner of the initiative has already established a dedicated company – Fnality International – and invested over $63 million in the development of the token. Actually, the bank has been working on such Bitcoin-like token (USC, utility settlement coin) for several years, while the Wall Street Journal labeled the project as one of the largest blockchain initiatives and push adoption of the innovative technology in the banking sector.
“Several blockchain projects are moving out of the experimental phase and into production, a sign that the technology is becoming more integrated in the global financial infrastructure,” the Wall Street Journal writes.
The USC token would allow reducing time and cost of cross-border transactions processing as it will function both as a payment device and a messenger that holds the information about a transaction.
“You remove settlement risk, the counterparty risk, the market risk. All of those risks add up to costs and inefficiencies in the marketplace,” Hyder Jaffrey, head of strategic investment at UBS, commented.
Meanwhile, Fnality International has initiated negotiations with regulators to obtain the required licenses and permissions. The token is supposed to be launched within a year.
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