http://www.coindesk.com/santander-vies-become-first-bank-issue-digital-cash-blockchain/
They even have a name for their public Ethereum token. CashETH!
They even have a name for their public Ethereum token. CashETH!
Spanish banking giant Santander is working on a project that explores how it could digitize customer cash using the public ethereum blockchain.
Revealed today during a panel talk at Devcon2 by Ether.camp founder and ethereum Java client developer Roman Mandeleil, the news was confirmed by representatives of Santander. In statements, Santander said its goal is to open up its bank-issued funds to a community of innovators as a way of tapping additional efficiencies.
Given the recent deluge of proofs-of-concepts and consortium announcements, Santander's move to potentially issue digital cash on a live public blockchain emerges as one of the more unique projects globally. Running for more than a year, the ethereum network has a market cap of more than $1bn and nearly 40,000 in daily transactions.
In interview, Mandeleil explained that the Santander project envisions how the bank’s customers could convert money from their real bank accounts into a 'tokenized' online currency called 'Cash ETH' that would be redeemable for paper currency.
In a demonstration, Mandeleil showed how a fictional customer could use the prototype to create digital money for use at online merchants and accessible with a mnemonic passcode called a brain wallet. (Despite past issues with the concept, he called this version "statistically hard to break").
Santander representatives indicated that the bank is now seeking to work with Ether.camp on engaging other banking partners in the project. The two partners are also looking to run hackathons that would focus on developing use cases around micropayments.
In essence, the project aims to envision a way for banks to open up their basic bank account offerings to new ideas and transactional services. Further, Mandeleil said the project is part of his 10-person startup's vision that focuses more on using blockchain technologies to achieve incremental benefits for banks and consumers.
"It's more like evolution, not revolution," he said. Still, he emphasized that the trial, should it go live, would mark a "huge leap" by establishing a connection between a publicly traded financial firm and and a public blockchain.
"You can start to build more and more stuff and say to the regulators 'It's not so scary,'" he continued.
Elsewhere, in his talk, Mandeleil discussed Ether.camp'sk with blockchain startup firms including Gemini and Rootstock.
Mass media
Mandeleil showcased a system whereby a Santander customer would have three new options to coincide with their traditional bank account – tokenize, transfer or refund.
Should the user elect to 'tokenize' their funds, the system is set up to allow for payments of as low as $0.01, though small charges may add to Santander’s earnings depending on how the user chooses to allocate the funds. In the example, $350 in funds were withdraw to a test version of the ethereum blockchain, with $1 going toward gas payments, which are needed as payment to execute transactions on the network.
By paying the gas upfront, the user is allotted a certain pre-set number of transactions they can execute, though this figure can be increased with additional payment. Mandeleil sees the digital Santander dollars as a viable alternative to PayPal.
"It's not something that users will not do to have the agility of money. You click on the payment, then you put in the private key and you have the balance and the reliable transactions," he said.
To offer a better view on the project, Mandeleil walked CoinDesk through a version of the prototype in which a user tokenized funds for use as payment for an article on a demo version of The New York Times website.
