MUFG Scraps Blockchain Payment Network Plan, Blames COVID for Transaction Deficit

  • Slow growth in transaction numbers as a result of the pandemic made it difficult to expand the business at the planned rate.
  • Mitsubishi UFJ Financial Group (MUFG), one of Japan’s largest financial institutions, has announced the suspension and closure of its high-speed blockchain payment network venture GO-NET Japan.
  • Slow growth in transaction volume as a result of the COVID-19 pandemic made it difficult to expand the business at the planned rate, MUFG said on Wednesday.
  • Furthermore, the network was unable to find a niche in the internet of things (IoT) market, which it intended to enter.

“As a result, the business is not expected to achieve profitability in a reasonable timeframe,” according to MUFG. “GO-NET Japan will suspend operations and GO-liquidation NET’s procedures, and GO-NET Japan will then proceed.”

The Global Open Network (GO-NET) collaboration with Cambridge, Massachusetts-based tech firm Akamai was announced in November 2020 with the goal of providing more affordable and efficient payment services. According to GO-NET, the platform can handle 100,000 transactions per second and can be scaled up to 10 million per second for small payments.

This announcement does not signal the end of MUFG’s involvement in the blockchain and digital currency industries. Its trust banking division announced earlier this month plans to issue a stablecoin pegged to the yen as a means of payment to enable instant settlement of security transactions.

Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.

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