Global Banks Joining Forces to Create New Digital Currency. It is very hard to find a person or an institution from the financial sector that hasn’t been thinking about joining the digital market currency because this market has been booming in the last couple of years and this year especially. Because of that, it is no wonder that many financial institutions in the world are actually trying to find the best possible ways to become a part of the cryptocurrency market.
Lately, we have seen a significant increase in banks attempting more or less successfully to create their own digital currency and the latest example is just another step in turning the cryptocurrency into legitimate in many parts of the world. Namely, six of the biggest banks in the world have joined efforts in order to create their own digital currency. According to some sources, they intend to launch their digital currency next year and it is has been announced that this digital currency will be using the blockchain technology just like Bitcoin.
Taking Their Spot in the Market
The six banks that joined together are Credit Suisse, HSBC, State Street, MUFG, Barclays, and Canadian Imperial Bank of Commerce. They are said to be working on the ‘utility settlement coin.’ Interestingly, this coin has been created some time ago by the UBS, a bank from Switzerland, that used it as a way of making the financial market more efficient. These banks have announced that they will be working together with countries’ central banks to provide better security of the data as well as the improved cyber protection.
Back when blockchain technology was in its infancy and when some digital currencies, including Bitcoin, started to use it, central banks from all over the world were skeptical towards it. However, things have changed and after blockchain proved to be more than an efficient platform for digital currencies, central banks are trying to adopt this system for their digital currencies. Now, these six banks have announced that their digital currency will be based on the blockchain technology.
For those who are not aware of what the blockchain is it needs to be said that this technology operates on a very complex set of algorithms that provide cryptocurrencies such as Bitcoin, Ethereum, Monero, and others with the ability to be traded and more importantly verified electronically by using the network of computers without having to have one centralized record of all transactions.
Not Missing on Value
One of the main reasons why these six banks decided to join forces to create digital currency is for them to be able to buy bonds, equities, and other securities or commodities without having to wait for the traditional money to be transferred from one account to another. Working with central banks, these six banks have made it possible for them to convert these digital currencies into traditional money without having to wait a long time and avoiding other costs that come with the conversion.
However, these six banks are not the only one that will be working on this project. Even before these six banks announced their project, banks such as Banco Santander, NEX, Deutsche Bank, and BNY Mellon have already been working on this project and the new six banks will be just joining their effort. The fact that the biggest nine banks in the world have opted for digital currencies speaks enough about the future of the digital currency market and its future in the financial sector.
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