Swiss bank giant UBS said it was a proof-of-concept of his UBS Key4 Gold offer on the Ethereum Layer-2 Network ZKSYNC.
The simulation, which was performed on a ZKSync test network, is a sign of renewed interest in blockchain technology at traditional financial institutions. This is not the first UBS experiment with blockchain. The bank previously launched a tokenized money market investment fund, Umint, which was also built on Ethereum.
The Key4 -gold from UBS is one of the offers of the bank with which its Swiss customers can buy a direct claim on physical gold. “It provides fractional gold investments with real -time prices, deep liquidity, safe physical storage and optional physical delivery,” the team said in a press release shared with Coindesk.
The project already exists on the bank’s private blockchain, the UBS Gold Network, but the team was looking for ways to scale his project while retaining its privacy. “They came to the conclusion that only zero knowledge was logical for them, and so they really wanted to put this in practice for a product that they already have live and what this could look like if they use the validium instead, “Pearl Imbach, a Senior Business Development Manager at Matter Labs, the most important developer company behind ZKSync, told Coindesk in an interview.
ZKSYNC is a zero-knowledge rollup, a type of layer 2 scale system that aims to increase the speed of blockchain transactions and to lower their costs by using zero knowledge cryptography. A Validum is another type of layer-2, similar to that of a rollup, but stores the data of those transactions off-chain.
The test transaction can indicate that UBS could look closer to the use of Layer-2 technologies to provide some of its activities with power. However, the bank did not say if they would come up with their own layer-2, and Imbach from Matter Labs told Coindesk that a rollup might not be suitable for them. “Is this the right product [for UBS]? Maybe not, but it is something we just talk about, and think about what could actually be a good use case for them, “Imbach Coindesk said.
This is not the first time that a bank giant has used the technology of ZKSync for his own products. Deutsche Bank said in December that it was also planning to build a low-2 with the technology of ZKSYNC, which indicates how blockchain technology can co-exist or even make the products of traditional financial institutions work better .
“What we offer now, with privacy at the top [of the blockchain] Is something that is super interesting, and we are now doing more and more of these use cases, “Imbach told Coindesk.
Read more: Deutsche Bank’s L2 Blockchain to be ‘public and permission’, says Tech Partner