They expect to use it for instant settlement of securities transactions already in 2018
Swiss bank with partners from other countries intend to carry out calculations on transactions through the Central Bank with the "practical money"
E. Reasonable / Vedomosti
Four leading Bank have joined forces to develop a digital currency, which they hope to make a standard method of calculation and settlement of financial transactions. Cryptocurrency, which began to develop its UBS called utility settlement coin (which can be translated as "practical, money for settlements"), uses the technology of block circuits underlying Bitcoins.
For UBS joined Deutsche Bank, Santander and BNY Mellon, as well as broker ICAP. According to Haider Jeffrey,director of financial innovation in tehologicheskim of UBS, they plan for the next year to submit applications of cryptocurrency regulators and central banks, to get their approval and at the beginning of 2018 to start its commercial use "in a limited number of low-risk operations."
Global banks are adopting new technology blokcheyna. After a few years it will be all over the place
Fearing fraud, the world's largest banks are initially skeptical of the technology chain block, which uses a decentralized network of computers for electronic verification of financial transactions. But then they began to actively explore the possibility of its application to accelerate the settlement of transactions, which are now carried out through the back offices and require billions of dollars in maintenance for a period of clearing and funds transfer. The consulting company Oliver Wyman last year estimated the annual costs ssovokupnye financial industry for clearing and settlement of transactions in the $ 65-80 billion.
"Today, trade between the banks and other organizations - a complicated matter, consuming a lot of time and costly; that's why we keep large back offices. [New technology] will simplify and speed up the process and make it more effective ", - says Julio Faura, director of research, development and innovation in Santander.
Cryptocurrency utility settlement coin should help financial institutions to pay for the securities (stocks, bonds), without waiting for the transfer of real money funds will be completed in a conventional manner. Instead, they can use cryptocurrency, which will be directly converted into cash at the central bank. This should reduce the time and costs of the clearing and settlement of transactions after.
Digital money can be converted into any currency and stored using block chains or distributed registry technology, they can be quickly exchanged for securities, which conducted the transaction. "To get the most benefit from these technologies, you need to have a digital currency in a distributed registry. This allows you to eliminate the time spent on the process, such as the expectation of the arrival of payment, and free up capital tied to it ", - says Jeffrey.
they can be quickly exchanged for securities, which conducted the transaction. "To get the most benefit from these technologies, you need to have a digital currency in a distributed registry. This allows you to eliminate the time spent on the process, such as the expectation of the arrival of payment, and free up capital tied to it ", - says Jeffrey.
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A number of financial institutions develop alternative cryptocurrency. The Setl London Group, founded in 2015 by investors of hedge funds and specialists in trading, is also planning to carry out calculations on transactions in the financial market with a digital currency directly from the central banks. Citigroup develops Citicoin, and Goldman Sachs applied for a patent with SETLcoin technology that should allow almost immediately to carry out calculations on the transaction. JPMorgan Chase is working on a similar project.
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Some central banks, including the US Federal Reserve, Bank of England and the Bank of Canada, analyzed the potential benefits from the use of cryptocurrency. Critical issues to be addressed - the security of such transactions and their impact on the stability of the banking system.
According to David Treat, head of practice on the use of chains on the block in Accenture's capital markets, the fact that the technology began to be used in a serious scale, will take three to five years, and then it will take a few years to become a mass.
Translated Michael Overchenko
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