Bank of Tokyo-Mitsubishi (MUFG) testing its own digital currency

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The Bank of Tokyo-Mitsubishi UFJ said on Tuesday it is running experiments on a digital currency using the tech behind the virtual currency bitcoin.

The statement followed a report from the Asahi Shimbun newspaper that the bank will issue a virtual currency from next year.

“Regarding the speculation (in) media reports, these reports are not based on any announcement by MUFG, and the details have not been decided”, the bank’s spokesman said in a statement provided to news outlet Reuters..

MUFG stands for Mitsubishi UFJ Financial Group Inc, which is the bank’s parent company.

“However we can only say that it’s true that MUFG is conducting demonstration experiments on the ‘Coin’ within the company utilizing a block chain technology”.

The report said users will be able to withdraw money from their bank into an app on their smartphones. The money will apparently be converted at one MUFG coin to one Yen.

The coin system is said to work like prepaid electronic money, such as “Suica” which is already widely used in Japan. Users will though be able to remit the coins to others via the Internet.

The bank is also researching ATM machines that will allow customers to withdraw MUFG coins to their phones. The ATM is expected by spring 2018 and will also allow users to change the virtual coins into cash.

Over the past year several Wall Street firms have declared their commitment to pursuing blockchain as a new technology for tracking and clearing financial transactions.

Blockchains work by creating permanent, public “ledgers” of all transactions that could one day replace complicated clearing and settlement systems with just a single simple ledger.

SOURCE: Reuters.

Larry Banks is a keen follower of technology and finance. He has worked for a variety of online publications, writing about a diverse range of topics including mobile networks, patents, and Internet video delivery technologies.

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