The Bank of England is testing blockchain tech to support domestic payments

The Bank of England said last week that it’s currently working on a “proof of concept” to see if its real-time gross settlement (RTGS) service will benefit from blockchain technology. The bank’s governor, Mark Carney, revealed the plans in April 2017, saying that securities settlements need innovation, and blockchain technology – aka distributed ledger tech – could produce “significant” gains regarding platform stability, efficiency, accuracy, and security. 

Real-time gross settlement systems are means for transferring money from one bank to another. The “real-time” aspect means there’s no annoying waiting period once your funds now reside at the recipient bank. Meanwhile, the “gross” aspect defines a one-to-one transaction and does not include transactions from other accounts. Finally, the “settlement” term simply means the transaction is final and cannot be reversed. 

Typically, a blockchain relies on a network of computers spread out across the globe supporting a database, aka the ledger, based on cryptography. This ledger stores transactions but is incapable of linking to specific individuals due to its cryptographic nature. Every transaction has a unique key and is stamped by a trusted party. That key is then stored with the next transaction, which is itself encrypted using a cryptographic formula. Rinse and repeat, and you have a chain of transactions that can’t be altered without modifying all previous transactions. 

“Although the Bank has concluded that Distributed Ledger Technology (DLT) is not yet sufficiently mature to provide the core for the next generation of RTGS, it places a high priority on ensuring that the new service is capable of interfacing with DLT as and when it is developed in the wider sterling markets,” the Bank of England reports. 

That’s where the proof of concept comes in. The bank is now working with Baton Systems, Clearmatics Technologies Ltd, R3, and Token, who now have access to the proof of concept: a cloud-based system that replicates a version of its pre-funded net settlement that could eventually serve U.K. retail payment systems. Those involved with the proof of concept will explore the best way of interfacing with the platform and how to better expand the RTGS service. 

Blockchain technology was first described in 1991 by Stuart Haber and W. Scott Stornetta. But it didn’t become a more common term until the arrival of Bitcoin, which uses a public blockchain/ledger to store all Bitcoin-based transactions. But the bank’s use of a blockchain doesn’t mean it will rely on a public ledger maintained by millions of PCs across the globe. This blockchain will likely be maintained by the bank itself and all other organizations accessing the platform. 

“The Bank of England has set out its vision for a renewed RTGS service that will deliver a materially stronger, more resilient, flexible, and innovative sterling settlement system for the United Kingdom to respond to the rapidly changing payments landscape,” the bank says. “The renewed service will offer a diverse and flexible range of settlement models.” 

The Bank of England will publish a summary of its proof of concept findings later in 2018. 

Emerging Tech

How Super Mario, Magic: The Gathering, and PowerPoint are low-key supercomputers

What if the creators of Super Mario World, PowerPoint, and even Magic: The Gathering had accidentally created tools hiding a general-purpose computer in plain sight? Turns out they have.
Movies & TV

The best shows on Netflix right now (May 2019)

Looking for a new show to binge? Lucky for you, we've curated a list of the best shows on Netflix, whether you're a fan of outlandish anime, dramatic period pieces, or shows that leave you questioning what lies beyond.
Movies & TV

Prime-time TV: Here are the best shows on Amazon Prime right now

There's more to Amazon Prime than free two-day shipping, including access to a number of phenomenal shows at no extra cost. To make the sifting easier, here are our favorite shows currently streaming on Amazon Prime.
Movies & TV

Skip the flowers and sunshine this spring and watch the best shows on Hulu

It's often overwhelming to navigate Hulu's robust library of TV shows. To help, we put together a list of the best shows on Hulu, whether you're into frenetic cartoons, intelligent dramas, or anything in between.
Business

Jeff Bezos breaks ground on $1.5B Amazon cargo hub for 100 Prime Air planes

Amazon has all kinds of plans to speed up delivery times, but none come bigger than the $1.5 billion air cargo hub that it's building in Kentucky for up to 100 of its Prime Air cargo planes.
Mobile

American Express expands its dining app services by purchasing Resy

American Express is continuing to snap up apps and services within the lifestyle bracket. Today, the monolithic financial giant has announced it is purchasing the restaurant reservation app Resy.
Mobile

FCC could require carriers to block robocalls. Here’s why they didn’t before

The FCC is considering making legal protections for carriers that want to block robocalls. In the past, carriers were worried about the legal implications of blocking legitimate robocalls, but these new protections could change that.
Social Media

Instagram’s new Explore grid tempts you to open your wallet

Instagram has made some changes to its Explore tab that might tempt you into the occasional shopping spree. It's also planning to add Stories to the grid, mixing them up with the existing photos and videos.
Business

The 15 best tech jobs boast top salaries, high satisfaction, lots of openings

May may be coming to an end, but the bonanza of tech jobs just keeps coming. High paying jobs abound at companies where people love to work. If you’re not satisfied with your current situation or are ready to make a change, this is a…
Web

Gmail logs your purchase history, undermining Google’s commitment to privacy

Google has tried to portray itself as privacy-focused. But a new report shows Google tracks many of your online purchases, even if they are bought from a non-Google affiliated store like Amazon.
Mobile

FCC chairman and commissioner support the T-Mobile and Sprint merger

T-Mobile and Sprint are getting closer to merging. After a few failed attempts, the two companies announced their merger at the start of 2018. The new T-Mobile could be better positioned to take on the likes of Verizon and AT&T.
Cars

GM hits reverse with Maven carsharing as it closes service in eight cities

GM-owned Maven will close its carsharing service in 8 of the 17 North American cities where it currently operates. Competing with the likes of Zipcar and Car2Go, the app-based service offers car rental by the hour or day.
Social Media

Twitter co-founder Ev Williams still wants to save the world

Social media is evil, leading to a mental health crisis in Gen Z and a rise in hate speech. But there’s light at the end of the tunnel, says Ev Williams, the co-founder of Twitter. But weaning ourselves off today's social media won't be…
Cars

Many Uber and Lyft vehicles have open safety recalls, report says

A Consumer Reports survey of roughly 94,000 cars registered with Uber and Lyft in New York City and Seattle found that many had open safety recalls. The rate of open recalls was similar to that of personal cars, however.