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Union Bank of Switzerland (UBS), the largest bank in Switzerland, has initiated trials for a digital gold investment product on the Ethereum 
$2,491-based ZKsync layer-2. The bank is testing gold trading operations using blockchain technology to enhance functionality on a global scale.
Trial Process and Product Details
The product being tested, UBS Key4 Gold, allows users to trade gold units on-chain. It provides individual investors the opportunity to invest in fractional gold while offering real-time pricing, deep liquidity, and secure physical storage options.
Blockchain Technology and Strategies
In this trial, UBS utilized the ZKsync Validium solution under a proof of concept (PoC) framework. The goal was to improve scalability, privacy, and interoperability, contributing to the product’s global expansion.
UBS Key4 Gold operates on a permissioned blockchain infrastructure known as the UBS Gold Network. This network connects vaults, liquidity providers, and distributors, ensuring technical support for the product. It is seen as a step toward the digitization of the gold market.
Alex Gluchowski, one of the co-founders of ZKsync, stated, “This PoC reflects UBS’s efforts to develop financial products using blockchain technology. I believe that future financial transactions will occur on-chain, and ZK technology will be a catalyst for this growth.”
The testing process is considered significant for establishing a robust technical infrastructure for the product. Additionally, fluctuations in the ZK token price are being closely monitored within the context of market volatility.
The trial provides important insights into the digitization in the fintech sector and the application of blockchain technology in finance. Various technical tests and applications can serve as a guide for the product’s integration into global markets.
