Swiss banking giant UBS has gathered ten creative heads at its London-based fintech laboratory to come up with something that promises to propel digital banking into a new era.

«To make it quite clear from the start,» said Alex Batlin, «we're not working on a UBS-coin here.» Batlin is head of the UBS laboratory at London's biggest fintech-incubator, Level 39, and eager to keep his distance from Bitcoin, the best-known crypto currency available.

The big plan of the ten geeks under Batlin's command is nonetheless ambitious. In the laboratory they plan to use the so-called Blockchain technology, on which Bitcoin is also based, to create an industry-wide digital currency. A currency to process financial transactions, and a means to build bridges between trading and crypto currency platforms in the future.

Connectivity Is Key to Success

Batlin 160Batlin aims to present a first draft of his teams findings at the beginning of 2016, he said at a media conference in London, which finews.ch attended. The new currency has not been given a name yet. Batlin's crew is using the working name of Utility-Coin, making reference to its intended use, which is the connection of as many parties and platforms in the banking industry as possible.

The demands on the new currency are high. The coins will not only have a value in the digital world but should also be linked to deposits of financial institutions at central banks. Thereby, Batlin said, a digital franc becomes a real franc.

Libertarian Suspicions

With this approach, UBS is preaching to the converted, at least at some central  banks. The Federal Reserve and the Bank of England recently discussed the possibilities of central bank-based digital currencies.

The crypto-currency community, with its strong libertarian leanings, will be more suspicious about the entry of the big player into its domain. Not surprisingly therefore, UBS is putting the emphasis on a cooperative approach: the guiding principle of the experiment is to make the Blockchain technology for banking purposes more tailorable, more secure and readily accessible for as many participants as possible.

UBS is using the technology of other players in this segment, in particular of Etherum, a Zug-based fintech startup and Clearmatics, specialists on Blockchain stock exchange technology, Batlin said.

 The results are keenly expected.