Japan has emerged as a leading player in the cryptocurrency and blockchain technology markets. The country, following its recent regulation recognizing Bitcoin as a currency and a legal mode of payment, has now taken a step towards creating a standard blockchain platform for the Japanese banking industry.
There are a number of blockchain platforms currently available in the market. The global banking and financial sector, after understanding the benefits of blockchain solutions in their operations are invested in research and development of the technology. The choice of blockchain platform among these banks currently varies from existing solutions to new ones that are being built from scratch. This approach has created concerns about interoperability of these blockchain solutions.
The banking industry depends on a network of domestic and international banks to facilitate the flow of money and information between accounts. The Japanese Bankers Association is going to make it possible by urging the member institutions to conduct their research and development activities on a common blockchain platform. The approach adopted by the association also helps in standardizing the blockchain solution across all the banking institutions, making an allowance for seamless integration and onboarding of new organizations.
The blockchain initiative was announced yesterday by the Japanese Bankers Association. It will be similar to many global scale projects like R3 Blockchain Consortium, Hyperledger Project and more. According to reports, the Japanese banks that part of the association will start trials of the developed distributed ledger solutions later this fall.
Once the blockchain solution is widely adopted across Japan’s banking institutions, the transaction costs are expected to go down by about 90%. The distributed ledger network will eventually replace the existing Zengin server system currently connecting the banks.
The implementation of blockchain solutions in the country’s banking sector will help mainstream banking and financial institutions readily deal with Bitcoin transactions and investments. This capability will come in handy as Bitcoin usage is set to increase in the country following its newly attained legal status.
Ref: Nikkei Asian Review | Image: NewsBTC