BoE plans to launch Blockchain-friendly payment system, which will be resistant to cyber-attacks. The system will also be available for a wide range of smaller businesses.
24 July, AtoZ Markets – The Bank of England is planning to update its payment system. The new system will be compatible with Blockchain-based financial technology firms, according to a number of online reports.
BoE Plans to Launch Blockchain-friendly Payment System
The announcement from BoE has emerged as the latest move from the central bank towards its efforts to modernize its Real-Time Gross Settlement system (RTGS). The system is a vital element for the banking and trading in the UK, as it manages transactions that are worth around £500 billion annually.
The new updated system is expected to go live in 2020, and it will be resistant to cyber-attacks, according to the BoE. The system will also be available for a wide range of smaller businesses. This would provide these businesses with an opportunity to use the system directly instead of having to use a proxy of a large bank.
RTGS System Test
Back in March, the BoE has published a “proof of concept”, asking a number of firms for feedback. Payments technology providers Baton Systems and Token, R3 and Clearmatics have been asked to assess whether the new cloud-based RTGS service would be able to interact with systems via the distributed ledger technology (DLT). The firms needed to examine how its functionality could be improved through the use of new technologies. The BoE has stated on Monday:
“All participants confirmed that the functionality offered by the renewed RTGS service would enable their systems to connect and to achieve settlement in central bank money. A number of recommendations were received to ensure optimal access to central bank money.”
One of the recommendations was to explore the possible uses of “cryptographic proofs” to secure data from being stolen or changed.
Think we missed something? Let us know in the comments section below.