The Four Major Banks Jointly Develop New Currencies, And The Potential Of Block Chain Technology Has Become A Hot Spot.

A bank is a financial institution established in accordance with the law to operate money and credit businesses.

Bank is the product of the development of commodity money economy to a certain stage.

Banks are one of the financial institutions. Banks are classified according to their types: central banks, commercial banks, investment banks, policy banks and the world bank.

Money is a tool used as a medium of exchange, a storage value and a unit of account. It is a special commodity that acts as an equivalent in the exchange of goods and services. It is a material appendage and symbol appendage of people's commodity values.

It includes both currency in circulation, especially legal currency, and all kinds of savings deposits. In the field of modern economy, only a small portion of the field of money is displayed in the way of real currency, that is, the actual use of paper money or coins, and most of the pactions use a check or a check.

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The four largest banks in the world: UBS, Deutsche Bank, Santander and New York Mellon bank have jointly developed new e-money, hoping that they will be able to liquidate pactions through block chain technology in the future and become a universal standard in the global banking industry.

The four banks will also work with the British broker ICAP to sell the scheme to central banks, and plan to make their first commercial application in early 2018.

The plan will be officially announced on Wednesday, UK time. The four major banks plan to improve the efficiency of the financial market by using block chain technology and "de centralization" computer network.

The scheme is the most concrete and practical cooperation that banks have achieved in this regard so far.

Julio Faura, managing director of R & D and innovation at Santander bank, said in an interview with FT: "pactions between banks and institutions are actually cumbersome, time-consuming and costly, which requires banks to have many resources to the backstage.

This solution can help banks simplify paction clearing process and make the whole system more efficient.

Block chain technology is essentially a collection of algorithms. By way of algorithm, it can "bypass" the Central Ledger accounting method adopted by the current bank, and electronically authenticated the pactions directly through the computer network. The object of authentication is cryptocurrencies, and bitcoin is one of them.

Banks began to be skeptical of this technology because they were worried that there might be loopholes in the fraud.

Today, banks have become active applications of the technology, trying to use the new technology to pform their backstage clearing system so as to free up tens of billions of capital that banks have been occupying in Global trade and in the process of liquidation.

In a report last year, Orwell consulting estimated that the world

The cost of clearing pactions each year is between 65 billion and 80 billion dollars.

However, the four main line is not without competitors.

Last year, Setl, which was founded in London by hedge funds, also plans to liquidate all pactions in the financial market through electronic money directly connected to the central bank.

Citibank has set up a similar "Citigroup" project, Goldman Sachs has become its "SETLcoin".

Patent application, the technology can carry on the paction to carry on the seamless instantaneous liquidation, Morgan Chase also develops similarly.

Decentralized centralization: every node and miner in the block chain must follow the same bookkeeping paction rule, which is based on cryptographic algorithm instead of credit, and each paction needs the approval of other users in the network, so there is no need to endorse a set of third party intermediaries or trust agencies.

No trust system: in the block chain network, the behavior of any malicious deception system will be excluded and suppressed by other nodes through the self-restraint of the algorithm. Therefore, the block chain system does not rely on the central authority's support and credit endorsement.

Non tampering and encryption security: block chaining adopts a one-way hash algorithm, while each newly generated block is pushed forward strictly in line with time sequence. The irreversibility of time leads to any attempt to intrude the data information in the tampered block chain, which is easily traced, resulting in exclusion by other nodes, which can restrict related illegal behaviors.

although

The safety and potential of the system have become more and more common. But it is still a long time before it can be widely applied.

In an interview with FT, David Threat, head of Accenture financial market block chain technology, said that the technology may take 3-5 years to show a certain scale of application, and it will take longer for general application.