The biggest Swiss bank, UBS, is using blockchain technology to transform digital gold investments. The solution will improve the system’s security, scalability, and accessibility for individual investors. It is built on top of ZKsync Validium, an Ethereum L2 scaling solution.
This may change the overall dynamics in the gold trading market by making it more efficient, private, and cost-effective.
Why UBS is Turning to Blockchain for Gold Investments
Traditionally, gold investments involved intermediaries, including banks and brokers, and hence slowed down and increased the costs of transactions.UBS intends to change this situation by integrating blockchain technology into its fractional gold investment product, UBS Key4 Gold. Running on ZKsync Validium, the blockchain-based solution enhances scalability by allowing faster transactions and a reduction in the costs. It also improves privacy through the offchain secure storage of data while ensuring interoperability, thus enabling seamless global access for investors. This lines up with UBS’ broader efforts to enrich customer experiences and leverage blockchain into finance.
📈💰 UBS Looks into Blockchain for New Digital Gold Investments 💰📈#Blockchain #FinTech #Investing
— Real World Tokens (@realworldtokens) February 3, 2025
UBS integrates blockchain for digital gold… https://t.co/114iVQoUlu pic.twitter.com/Y2sIxEmUAT
How ZKsync Improves Investments in Gold
ZKsync Validium is a Layer-2 scaling solution for Ethereum transactions. Use of zero-knowledge proofs, or ZK-proofs, enhance security but slashes costs down to pennies per transaction while processing them rapidly. The firm targets 10,000 TPS by 2025 with the rate of $0.0001 per transaction. With the integration of ZKsync, UBS will be well-equipped in providing its retail investors with an efficient, seamless trading experience while enabling digital gold investments to be less costly.
Growing Need for Privacy in Blockchain Adoptions.
As mentioned earlier, institutional investors never found blockchain of interest due to a lack of transparency. And everything is taking a new face with the entry of privacy-centric technologies like FHE and confidential computing. More or less institutional investors, as per industry analysts, will make an entry because of these innovative discoveries, pour more liquidity in the crypto area, and liberate up to $1 trillion of new funds. As the solutions for privacy continue to advance, blockchain-based financial products, such as UBS Key4 Gold, could be adopted even more.
Therefore, This move by UBS to integrate blockchain in gold investment is a big step toward more efficient and accessible banking. The bank is thus securing transactions, reducing cost, and speeding up the execution of those transactions due to its utilization of ZKsync Validium. With time, privacy-preserving technologies are advancing, and blockchain integration into traditional finance will continue to thrive, taking up new opportunities for investors around the globe.
Finance, as a whole, is changing, and UBS will be best positioned as the first mover in such evolution. Digital finance may hold yet another major big thing, a blockchain-led investment in gold. Only time can tell. Projections seem fairly promising so far.
