Bank of Tokyo-Mitsubishi UFJ (MUFG), the largest bank in Japan, has revealed that it is developing its own digital currency called MUFG coin.
MUFG began the trial for its own virtual currency MUFG coin last fall and the smartphone application prototype that goes in tandem with the currency is also nearly done, as reported by the Asahi Shimbun , a national Japanese daily newspaper.
The project is the bank’s endeavor to rein in costs and increase savings from lowered financial transactional costs including cheaper international remittance and money transfer.
According to the publication, the currency is currently being seen as an in-house tender. However, the bank also sees potential for its digital currency to be issued to customers in the future.
The MUFG coin project, from what is revealed thus far, will rely on a P2P platform that makes use of a smartphone application to authenticate digital tokens.
An excerpt from the report explaining the technology reads:
MUFG coin takes advantage of the new technology that is on a network of multiple smaller computers. It is possible to cheaply build a tamper-resistant transaction record of the ledger, otherwise referred to as the “blockchain.”
MUFG’s interests in blockchain technology was already documented from its participation as one of 42 global banks in the R3-led private blockchain consortium. The collaborative effort is among the mainstream forays for the current banking and financial industry to study and explore blockchain solutions. R3 recently revealed a successful experiment wherein 11 banks took part in an R3-managed blockchain test powered by Ethereum on the Azure platform. The test ran successfully for multiple days across four continents with participating banks connected to a single distributed ledger.
In recent times, China’s central bank, the People’s Bank of China (PBOC) also announced plans to release its own digital currency. Among other factors, the PBOC sees increased transparency, lowering corruption & bureaucracy as well as reduced costs due to lowering the circulation of fiat currencies.
Japan’s largest bank’s interest in the blockchain- and digital currency space is matched by that of Japan’s leading venture capital firm SBI investment. The venture capital arm of SBI Holdings was revealed as the lead investor in the Series B round of financing in bitcoin exchange Kraken yesterday, following a “multi-million dollar agreement.”
Featured image from Shutterstock.