Royal Bank of Scotland (RBS) has made some warm overtures toward cryptocurrency as part of a renewed focus on innovation, made in response to a series of technology issues that have further weakened its reputation.
The past decade has been a rough one for the bank, at one point the world’s largest by assets held, now 17th. Among other British banks, it was hit hard by the 2008-09 financial crisis. Following a £20 billion bailout by the UK government, taxpayers became owners of 84% of the bank’s shares, which will now reportedly be divested at a loss.
The latest mishap involved the disappearance of 600,000 payments worth millions of pounds, which were cleaned up after three days. This follows the 2012 incident where a failed software update resulted in millions of customers unable to access cash or make payments.
Despite the bank investing £150 million annually to make its systems more resilient, it cannot rule further mishaps in the future since “it is not feasible to run 100% faultless systems.”
The bank has also paid over $1 billion in fines due to its involvement in the global forex rate rigging scandal.
The aforementioned £150 million is part of a dedicated to “addressing legacy issues, improving automation of core processes and innovation.”
One of the activities will be the investigation of the Ripple protocol, a “disruptive international currency payment technology”. Four tech teams from the bank will collaborate on how the protocol can be integrated with the bank’s infrastructure. RBS would join at least a half dozen other banks that have either already implemented Ripple or are considering it.
This past February, the bank’s Technology Solutions Centre (TSC) hosted . It allocated up £20,000 per team to transform concepts from the intensive 2.5-day event into viable business ideas.
The event highlighted how Bitcoin is more than just a medium for carrying out anonymous or dark net transaction, its organizers stating:
“Cryptocurrencies offer a philosophical departure from conventional currencies, potentially radically reshaping the power structures of contemporary banking by sidestepping the need for traditional banking structures.”
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