Major Global Banks Begin to Embrace Bitcoin and the Blockchain

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Established financial institutions have intensively looked into blockchain technology. Leading global banks such as the Commonwealth Bank of Australia, PrivatBank, and others that are part of financial services company R3’s blockchain conference have begun the development of a blockhain-based banking network, which will allow their clients and other financial institutions to settle transactions and identities securely with significantly lower costs.

PrivatBank

One of Ukraine’s biggest banks, PrivatBank, announced the “finalization of testing period for a service providing merchants with an option of accepting bitcoins for their goods.” The compliance teams at PrivatBank are currently working with the Central Bank of Ukraine and the federal government to establish certain regulatory policies.

PrivatBank—the country’s largest commercial bank and a multi-billion dollar investment and financial services company—has millions of users in its Internet banking system called Privat 24, and operates various payment networks such as LiqPAY, Electronic Coin-Free, and SMS-mobile banking systems.

Through the integration of Bitcoin, the bank hopes to target small and medium-sized businesses that often struggle to deal with high transaction fees and maintenance fees of 3D Secure Technology, their financial solution used to protect user funds from fraud.

Commonwealth Bank of Australia

Commonwealth Bank of Australia (CBA), one of the country’s largest banks, has announced the launch of a pilot blockchain network built by its computer engineers in CBA innovation lab. The bank announced that the distributed ledger will be used to create decentralized financial solutions and applications that will be adopted by its clients, institutional customers and partnering banks.

“It is clearly … faster, cheaper and more transparent than some of the existing practices we have today,” chief information officer David Whiteing stated at a Bitcoin conference.

“But more importantly than that, as we’ve looked at this and explored and experimented, it goes way beyond just banking, and from our perspective, that’s an exciting opportunity as well.”

An increasing number of banks are gearing towards blockchain technology to capitalize on the limitations of today’s banking systems and applications. In the upcoming months, banks plan to launch commercial applications to help users obtain financial transparency.