Swiss Bank UBS Explores Blockchain for Digital Gold on ZKsync

• UBS is testing blockchain to boost retail gold investments.
• ZKsync improves privacy and scalability for UBS’ gold platform.

Switzerland’s largest bank, UBS, has completed a successful proof of concept for its fractional gold investment product, UBS Key4 Gold. The project utilizes blockchain on ZKsync Validium, an L2 of the Ethereum network. With $5.7 trillion worth of assets managed to date, UBS stands at the forefront of integrating blockchain into traditional finance.

The bank’s idea is to enable gold investment through retail investors. It is scaling up with better privacy and interoperability issues, which will have to be faced in the implementation of a product on a global scale. The use of ZKsync technology also provides for greater throughput transactions along with data privacy.

Blockchain Enhances Scalability and Privacy for UBS Key4 Gold

UBS Key4 Gold was originally built on the bank’s UBS Gold Network, a permissioned blockchain that links vaults, liquidity providers, and distributors. With ZKsync Validium, this integration enables much more efficient and secure transactions through the storage of off-chain data, which will improve both privacy and scalability for the product.

“We believe the future of finance will happen on-chain, and ZK tech will be the growth enabler,” says Alex Gluchowski, who invented ZKsync. The blockchain solution represents an important milestone in UBS’s ongoing work to explore how blockchain can add strength to its financial offerings.

UBS offers Key4 Gold as a product that allows investors to invest in fractional gold investments. So, this brings more accessibility towards the gold market for investors since blockchain ensures streamlined and secure transactions and attracts retail investors who are interested in holding tangible assets.

This is about three months since UBS had rolled out a tokenized fund on Ethereum, in its efforts to force blockchain technology into traditional financial systems. Soon, ZKsync will process up to 10,000 transactions per second by 2025 and create reduced transaction fees, making it more attractive for blockchain developers.

The rapid scaling of ZKsync and the focus given to its privacy and security make it the best choice for financial institutions looking to enrich their blockchain-based products.

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