Banks to join forces for blockchain-based settlement project

Several of the world’s largest banks are in the process of investing around US$50 million to create a digital cash system using blockchain technology to settle financial transactions, according to people familiar with the plans.

The previously disclosed project, known as the “utility settlement coin,” was first proposed by Swiss bank UBS Group AG and London-based technology startup Clearmatics in 2015. It aims to develop a system to make clearing and settlement in financial markets more efficient.

Around a dozen banks are investing in a new entity called Fnality which would run the project, one of the people said.

The deal has not been finalized so details may change. The new system could launch in 2020, the person said.

It is unclear which banks are participating in the investment round.

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