Japanese IT firm Fujitsu has revealed a new payments technology that connects different blockchains to enable exchanges and payments with various cryptocurrencies.
In an announcement yesterday, Japan’s largest IT firm revealed details of ‘ConnectionChain’, described as a security technology to securely connect multiple blockchains to make them interoperable to the extent of executing trades and payments in multiple cryptocurrencies. ‘A great deal of attention’ upon ‘virtual currency exchange among individuals and companies using initial coin offerings (ICOs) to raise capital from the virtual currencies’ spurred the development of its product, Fujitsu explained.
“Settlement between virtual currencies managed using blockchains, however, requires a reliable application to handle the currency exchange processing at the boundaries between the blockchains, and ensuring transparency in the process has been an ongoing issue,” the IT services firm added, underlining the need to introduce ‘ConnectionChain’.
To facilitate transfers between differing blockchains, Fujitsu unveiled its solution as a “connection-type chain” that records related transactions, in differing cryptocurrencies, on a dedicated blockchain.
“Fujitsu Laboratories has now developed an extension of smart contract technology which inter-connects multiple blockchains by recording the series of related transactions on each chain in a dedicated blockchain, or a “connection-type chain,” to link to the currency exchange into a single transaction process that can be automatically executed,” the IT firm elaborated. “It has also developed a transaction control technology to synchronise execution timing of the transaction process on each chain. With these technologies, transparency of transactions can be guaranteed, because all transaction processes are recorded as a trail in the connecting blockchains, even when they cross multiple chains.”
Fujitsu confirmed a successful trial of ‘ConnectionChain’ in a simulated virtual currency exchange flow, wherein the entire transaction trial was recorded in the connecting blockchain. The innovation will better facilitate payments in various regional currencies, the IT firm added.
Further, the announcement revealed plans toward commercializing ConnectionChain in 2018.
Fujitsu’s unveiling of its new payments technology to enhance cryptocurrency trading comes at a time when the IT firm is separately working with Japan’s three ‘megabanks’ to develop a blockchain that will facilitate person-to-person (P2P) money transfers between actual bank accounts belonging to their retail customers.