Banking Giant Ubs Tests Zkync’s Layer-2 Tech, which shows tradfi’s deeper interest in crypto
Swiss Banking Giant UBS said it completed a proof-of-concept of the UBS Key4 that offers gold in the Ethereum Layer-2 Network Zksync.
The simulation, conducted on a ZKSYNC test network, is a sign of a modified interest in blockchain technology in traditional financial institutions. This is not the first UBS experiment with the blockchain. The bank had previously launched a tokenized Money investment funding to moneyUmint, also built in Ethereum.
UBS ‘Key4 Gold is one of the bank’s offerings that allows Swiss clients to buy a direct claim to physical gold. “It allows fractional gold investment with real-time pricing, deep liquidity, safe physical storage, and optional physical delivery,” the team said in a press release shared with CoinDesk.
The project is already on the bank’s private blockchain, the UBS Gold Network, but the team is looking for ways to measure its project while maintaining its privacy. “They ended up concluding that only zero-knowledge made sense for them, and so they really wanted to put it in practice for a product that they already had live and what it would look like if they used Validium,” Pearl imbach.
Zkssync is a zero-knowledge rollup, a kind of Layer 2 Scaling System aimed at increasing the speed of blockchain transactions and reducing their fees, by using Zero-knowledge cryptography. A validity is A different type of layer-2Similar to a rollup, but stores off-chain transactions data.
The test transaction may signal that UBS may look closer to the use of Layer-2 technologies to empower some of its activities. However, the bank did not say if they would come out of their own layer-2, and the Imbach of Matter Labs CoinDesk said that a rollup might not be right for them. “Is this the right product (for UBS)? Perhaps not, but this is something that we are just talking about, and thinks of what could be a good case of use for them,” Imbach said Kay CoinDesk.
This is not the first time a giant banking has used Zkssync technology for its own products. Deutsche Bank said in December It also plans to build a layer-2 with Zksync technology, which indicates how blockchain technology can come together or even make traditional financial institutions better.
“What we offer today, with privacy at the top (of the blockchain) is something that is super interesting, and we are doing more of these cases now,” Imbach told CoinDesk.
Read more: Deutsche Bank’s L2 blockchain to be ‘public and permitted,’ says the Tech partner
