Mitsubishi UFJ Financial Group (MUFG) has partnered with U.S. tech company Akamai Technologies to develop a blockchain technology service that the two firms say will drastically reduce transaction times without compromising security. The news marks the latest plunge by a large corporation in the blockchain space, as leaders across industries such as finance, retail, manufacturing and tech experiment with the underlying distributed ledger technology powering cryptocurrencies such as bitcoin. (See also: JPMorgan Dives Into Crypto Space.)
Faster Transactions Without Compromising Security
Over the past 18 months, MUFG, the world's fourth-largest bank, has been working with Akamai to design a blockchain built on Akamai's cloud-based Intelligent Platform to handle 1 million transactions per second at latencies of less than 2 seconds. As the firms continue to work on enhancing the technology, they foresee the new service will be capable of processing 10 million transactions per second. Bitcoin, the world's largest digital coin by market capitalization, has been criticized for its long transaction times. The virtual currency can only process seven transactions per second at latencies exceeding 10 minutes.
Akamai Labs chief technology officer Andy Champagne said the new blockchain service is best-suited for making traditional payments online. Ultimately, he says the service could pave the way for "micropayment-type transactions" in a world where connected devices on the Internet of Things (IoT) operate autonomously and make small orders for things such as detergent when the washer runs out of supplies. Champagne said the payment network application with Mitsubishi should roll out in early 2020.
MUFG is no stranger to the blockchain. Earlier this year, it was first reported by local news publication Manichi that the Japanese financial giant would launch its own digital currency. The cryptocurrency, which will be pegged to the Japanese yen, is slated to launch this year. MUFG is also an investor in leading U.S. cryptocurrency exchange Coinbase and has dabbled in blockchain projects with partners such as International Business Machines Corp. (IBM), financial industry consortium R3, and digital payments provider Ripple, among others. (See also: Crypto Trading Is Skyrocketing in Japan.)
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