Blockchain technology is making inroads in the financial sector. Banks are experimenting with this technology for various purposes. Japan’s biggest bank is ready to take things to the next level. Mitsubishi UFJ Financial Group – or MUFG – is partnering with Akamai to handle up to 1 million transactions per second.
MUFG has a Bold Plan of Action
For several years now, banks have been experimenting with blockchain technology. After multiple trials, tests, and proofs of concept, the first real-world implementation is coming to market soon. Japan’s MUFG is working on this feature as of right now. Together with US-based Akamai, the bank will commence the commercialization of blockchain payments.
The new blockchain being developed will mainly focus on a high throughput. Up to 1 million transactions per second will be supported. Additionally, the platform will confirm such transfers within 2 seconds or less. Even batches of transactions will adhere to this same schedule, which will introduce a lot of exciting opportunities.
Further scaling of the MUFG blockchain network is on the agenda. In future iterations, the solution will scale to 10 million transactions per second. Compared to Bitcoin’s infrastructure, that is a vast and radical improvement. This ledger system is built on Akamai’s cloud service, known as Akamai Intelligent Platform.
Disrupting the Financial Industry
It is important to note MUFG is not looking to use a public blockchain like Bitcoin’s. Instead, the collaboration with Akamai focuses on a permissioned infrastructure. Only verified members can join the network which orders and confirms payments. It is not the decentralized approach per se, but it can make a big impact moving forward. MUFG President and group CEO Nobuyuki Hirano comments:
“For years, the financial industry has sought to utilize blockchain to secure and hasten transaction processing, and lower associated costs, This new technology will “support significantly greater volumes of high-speed payment transactions without compromising the level of security required to combat fraudulent transactions.”
According to sources close to the matter, the MUFG blockchain payments system will go live in 2019 or early 2020. The bank is one of the front-runners when it comes to implementing blockchain technology. Other Japanese banks are also keeping a close eye on this developing industry. Most of the institutions have partnered with Ripple to experiment with new ideas and concepts.
Image from Shutterstock