Union Bank of Switzerland (UBS), the largest bank in Switzerland, has launched trials for a digital gold investment product on the Ethereum 2,743-based ZKsync layer-2. The bank is testing gold trading operations using blockchain technology in order to improve functionality on a global scale.
The product being tested, UBS Key4 Gold, allows users to trade gold units on-chain. It offers individual investors the opportunity to invest in fractional gold, while also providing real-time pricing, deep liquidity, and secure physical storage options.
During the trial, UBS utilized the ZKsync Validium solution under a proof of concept (PoC) framework. The aim was to enhance scalability, privacy, and interoperability, thereby contributing to the global expansion of the product.
UBS Key4 Gold operates on a permissioned blockchain infrastructure known as the UBS Gold Network. This network connects vaults, liquidity providers, and distributors, ensuring technical support for the product. It is seen as a step towards the digitization of the gold market.
Alex Gluchowski, one of the co-founders of ZKsync, stated, “This PoC reflects UBS’s efforts to develop financial products using blockchain technology. I believe that future financial transactions will occur on-chain, and ZK technology will be a catalyst for this growth.”
The testing process is considered significant in establishing a robust technical infrastructure for the product. In addition, the fluctuations in the ZKtoken price are being closely monitored in the context of market volatility.
The trial offers important insights into digitization in the fintech sector and the application of blockchain technology in finance. Various technical tests and applications can serve as a guide for the integration of the product into global markets.
