Six new banks have joined UBS (NYSE: UBS) in its effort to launch a digital cash system which aims at allowing financial markets to make payments and settle transactions quickly via blockchain technology, which cryptocurrency such as Bitcoin (Bitcoin) and Ethereum (ETH/USD) operate under, Fortune reports.
Barclays (LSE: BARC), Credit Suisse (NYSE: CS), Canadian Imperial Bank of Commerce (CM.TO), HSBC (NYSE: HSBC), MUFG and State Street have joined the group developing the “utility settlement coin” (USC).
USC is a digital cash equivalent of each of the major currencies backed by central banks. It would be convertible at parity with a bank deposit in the corresponding currency, making it fully backed by cash assets at a central bank.
"It may well inform the way central banks choose to move things forward. We see it as a stepping stone to a future where central banks issue their own cryptocurrency at some point,” HSBC's director of financial technology innovation, Hyder Jaffrey said in an interview.