UBS is exploring blockchain technology to modernize digital gold investments for retail investors.
The bank, which manages over $5.7 trillion in assets, has successfully completed a proof-of-concept for its fractional gold investment product, UBS Key4 Gold, on the Ethereum layer-2 (L2) network ZKsync Validium.ZKsync confirmed in a recent post on X that by integrating ZKsync, UBS aims to enhance scalability, privacy, and interoperability, paving the way for the global expansion of its retail-focused digital gold offering. The blockchain-based initiative reflects UBS’ ongoing commitment to leveraging emerging technologies to improve financial services.
.@UBS, Switzerland’s largest bank, is modernizing digital gold investments on @ZKsync.
In a PoC for UBS Gold, they tested ZKsync Validium. The goal: To address scalability, privacy, and interoperability for global expansion.
Let’s dive in???? pic.twitter.com/4SW2xOfRlS
— ZKsync (∎, ∆) (@zksync) January 31, 2025
ZKsync’s inventor, Alex Gluchowski, emphasized the transformative potential of blockchain in finance.
“I firmly believe that the future of finance will take place onchain and ZK technology will be the catalyst for growth,”
he stated in a January 31 post on X.
Originally, UBS Key4 Gold was built on the bank’s permissioned UBS Gold Network, which connects vaults, liquidity providers, and distributors. By migrating the solution to ZKsync Validium, UBS benefits from improved privacy, increased interoperability, and greater transaction efficiency due to off-chain data storage.
The move follows UBS’ broader blockchain initiatives, including its tokenized fund launch on Ethereum in late 2023. This project aimed to integrate Ether ($ETH) into traditional finance, reinforcing UBS’ push into digital assets.
Additionally, UBS has successfully completed a pilot of its blockchain-based payment system, UBS Digital Cash, aimed at improving the efficiency of cross-border transactions. The bank also highlighted that the trial involved both domestic payments within Switzerland and international transactions in multiple currencies, including U.S. dollars, Swiss francs, euros, and Chinese yuan.
ZKsync has set ambitious goals for 2025, aiming to process over 10,000 transactions per second (TPS) while reducing transaction fees to just $0.0001. The layer-2 scaling solution employs zero-knowledge proofs (ZK-proofs) to enhance Ethereum’s scalability, security, and privacy.
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