Blockchain technology nowadays is considered as the backbone of the new internet era that lets digital data to be circulated widely. The technology is used to prevent the digital information from being getting copied or stolen by any means. This is the major reason why the banking system is widely accepting the use of blockchain to carry out different financial activities.
This time, United Kingdom’s Central Bank, the Bank of England (BoE) has decided to revamp its payments system by accepting the power of blockchain technology. The new payment system aims to support the British banking as well as trading across all the secure blockchain circuits, and augment the security against cyber-attacks. As per reports, BoE plans to bring the new system into action by the year 2020 to enable and increase the overall transactions among businesses that can adapt to this change.
At present, the BoE is known to use the Real Time Gross Settlement (RTGS) system. This alone is known to facilitate a huge number of transactions accounting for around 500 billion pounds a day which is almost one-third of the entire economic output of Britain. The blockchain is always considered much superior to this system. It is definitely the next major step taken by BoE towards remittance as well as for banking service.
To check and examine the necessary amendments for the desired support in the blockchain technology several firms were involved that include Baton Systems and Token, Clearmatics, and R3. These firms had the task of analyzing whether the new RTGS that was revamped would allow significant interactions with the systems that work on the principle of decentralized ledger technology (DLT). In addition to that, the firms also detect the scope of the newer technologies and their utility in the new and secure payments systems.
As per the report released on Monday, Bank of England announced that all the participants stressed upon the functions and benefits provided by the revamped RTGS service. It was also confirmed that this new system would let them gain the settlement in the money involved in the Central Bank transactions.
The report delivered by Bank of England stated that the aptest solution for obtaining maximum performance is the cryptographic proofs. The testing centers involved in this process showcased a list of suggestions that could deliver the best access and optimum performance.
Among various suggestions offered by the testing centers, cryptographic proofs were one of them. This was with an aim to prevent any form of theft as well as manipulation of the data. Mark Carney, the Governor of the Bank of England has stressed the importance of the revamped payment system about four weeks ago. He has emphasized the fact that the new payment system was revamped with a hope of giving access to all the private payment options including the ones that were performed out by the blockchain systems.
As per Carney, banks will never be the sole organization with easy accessibility to the BoE. Thus, the significance related to blockchain system is being stressed in the future in the monetary system.