Ethereum is the platform that Swiss banking giant UBS has implemented to facilitate gold trading on the blockchain
UBS, a Swiss banking behemoth, has conducted a test of its blockchain-based gold investment product, Key4 Gold, on the Ethereum Layer-2 network ZKSync.
UBS, a Swiss financial behemoth, has effectively tested its UBS Key4 Gold product on ZKSync, an Ethereum Layer-2 network.
This action underscores the growing prevalence of blockchain technology among conventional financial institutions that prioritize security and efficiency.
UBS, which oversees assets valued at $5.7 trillion, is investigating the potential of blockchain technology to optimize gold investments, according to ZKSync on January 31.
The primary objective of the test is to enable the bank’s Swiss customers to purchase physical gold directly through a blockchain-based system, while simultaneously guaranteeing scalability, privacy, and interoperability.
UBS Key4 Gold provides real-time pricing, secure storage, and substantial liquidity, allowing retail investors to purchase fractional gold shares. The product functions on the UBS Gold Network, a permissionless blockchain that facilitates the networking of liquidity providers, vaults, and distributors.
UBS employed ZKSync’s Validium mode to enhance efficiency. This solution is a zero-knowledge rollup that improves scalability by storing data off-chain.
The bank deployed smart contracts on the Validium testnet to simulate the UBS Gold Network as part of the proof-of-concept. These contracts facilitated the issuance of gold tokens and the execution of transactions.
“This Proof of Concept demonstrates UBS’ ongoing endeavors to investigate the potential of blockchain technology to improve its financial services and enhance its overarching digital asset strategy.” Alex Gluchowski, the creator of ZKsync, expressed his conviction that the future of finance will occur on blockchain.
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