The Bank of England (BoE) has revamped its payments framework making it compatible with distributed ledger technologies (DLTs), Reuters detailed Monday.
What’s So Great About Great Britain’s Payments System
Real-Time Gross Settlement system (RTGS) is fundamental for banking and trading in Britain and conducts transactions worth circa £500 billion every year – around 33% of the nation's economic output. The updated system is going to be launched by 2020, and will be resistant to digital assaults while being accessible to an extensive number of smaller organizations. This would empower them to use the framework directly, rather than through an intermediary of a large bank.
Pilot’s Outcome to Set Them Straight
In March, the BoE introduced a "proof-of-concept," asking multiple firms, including payments technology suppliers Baton Systems and Token, R3 and Clearmatics, for criticism. They were requested to look at whether the "renewed" cloud-based RTGS service would have the capacity to connect with frameworks based on blockchain and how its functionality could be extended using innovations.
"All participants confirmed that the functionality offered by the renewed RTGS service would enable their systems to connect and to achieve settlement in central bank money," the BoE said on Monday. "A number of recommendations were received to ensure optimal access to central bank money." One of those proposals was to investigate the probable use of "cryptographic proofs" to shield data from being stolen or modified.