Leading banks and credit card giants are now reportedly taking part in a tokenized deposit pilot project launched by industry body UK Finance.
According to a new report from Bloomberg, companies such as Barclays, Citigroup, Mastercard and Visa are teaming up for this effort.
The project aims to create a commercial banking system for tokenized deposits and securities to make transactions across borders and systems easier and faster and reduce errors and fraud.
The UK financial pilot, called the ‘Regulated Liability Network’, is designed as a shared ledger with the ability to track bank payments. Network participants can register, transfer and settle transactions involving central bank money, commercial bank money and electronic money.
Says Gilbert Verdian, the CEO of Quant, which is providing blockchain technology for the pilot:
“Banks today see the need for programmable payments. It is a whole game changer for them, because business models can work more efficiently because they are not limited by the shackles of the current payment system.”
According to Bloomberg, the results of the pilot will be published in August.
Additional participants are invited to join the pilot in July, including yet-to-be-named fintech startups and technology companies to test products related to tokenized commercial bank money.
The project also envisions the platform being used by asset managers to tokenize their funds and for mortgage settlement using programmable funds.
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