While some years ago the idea of integrating blockchain solutions into the traditional banking system may have sounded absolutely impossible, now it is a reality. Though the interest in the emerging technology initially was noticed only from the side of neo banks and small financial institutions, now this tendency has captured banking giants as well.
This time we’ve received good news from Japan. It has become known that the country’s major financial group which is the fifth largest bank by assets in the world is going to launch a blockchain-based payments network next year.
Global Open Network
According to the information provided, above-mentioned Japan’s bank, Mitsubishi UFJ Financial Group, has entered in a partnership with U.S.-based fintech firm Akamai Technologies to create a joint venture called Global Open Network, Inc.
In the framework of this cooperation, the partners will launch a new blockchain-based payment network Go-Net. It is said that the network will be introduced in the first half of 2020.
The first plans to build Go-Net were announced in May 2018. It is said that both MUFG and Akamai will invest funds into this project. According to the information revealed, the capital of the new joint venture equals to $2.26 million, 80% of which is held by MUFG while the remaining 20% is the stake of Akamai.
What GO-Net Offers
It is expected that thanks to its focus on IoT, GO-Net will be much more than a traditional mobile payments network. The new platform will offer such features as IoT-enabled payment, micropayments, pay-per-use, and existing payment processing. It will help to reduce transaction costs for all kinds of payment services and will ensure growth in a number of transactions.
Nevertheless, it is still unclear whether the network will use MUFG Coin that the bank has been working on for several years already.
Speaking about the goals of their initiative, Hironori Kamezawa, Group CDTO of MUFG and CEO of GO-NET, stated:
“MUFG has high expectations for our joint venture with Akamai. Our goal is to enable rapid innovation in digital payment services, leveraging a transformative platform, with built-in security, hyper-scale and efficiencies. GO-NET aims to expand the payment network business to a global scale, and enhance the services to support diverse payment ideas in the upcoming IoT era.”
Both partners will make a significant contribution to the development of the joint venture. While Akamai will bring its Blockchain as a Service platform to power the new payment network, experts of MUFG will provide their deep knowledge and understanding of the specificity of the financial industry as well as their expertise in fussiness development.
Dr. Tom Leighton, CEO and co-founder of Akamai, also expressed his excitement about the project:
“This joint venture with MUFG sets the stage for a new blockchain-based online payment system that can better serve customers’ and partners’ payment processing needs.”
MUFG’s Blockchain Initiatives
The payment network is not the first initiative of the bank related to the emerging technologies. As it has been already mentioned, some years ago MUFG started working on its own cryptocurrency known as the MUFG Coin. The bank introduced its coin in October 2018.
And in November, Mitsubishi UFJ Financial Group took part in a pilot that presupposed putting a syndicated loan for $150 million on the blockchain network. The pilot was conducted in collaboration with Spanish banking giant BBVA and BNP Paribas from France.