Deutsche Bank’s L2 Blockchain Will Be ‘Public and Permissioned’, Says Tech Partner

Banking giant Deutsche Bank is building a Layer 2 packet network on Ethereum with Matter Labs’ ZKsync technology.

Bloomberg said project Wednesday and a representative of Matter Labs confirmed the incident.

The chain will be “public and permissioned L2,” Matter Labs head of business development Omar Azhar told CoinDesk via Telegram. When asked for more details, he did not immediately respond to a request for comment, referring the reporter to another participant in the project, Memento Blockchain. All in all “public permission” means anyone can see what’s happening on the network, but only authorized participants can do certain things.

The project is a sign of renewed interest in blockchain technology among institutions as prices for various cryptocurrencies reach all-time highs. It also echoes private enterprise blockchains, which are almost a fad ten years ago. These systems are disconnected from public chains like Ethereum and Bitcoin, but they sometimes receive code from them.

According to Bloomberg reportThe bank is creating a layer-2 network to address regulatory compliance issues that come with public blockchains in finance. (Regulatory institutions need to know what they are dealing with, which is difficult on completely open networks like the main Ethereum chain). The bank believes that by building layer-2 on top of Ethereum, it will improve the speed of transactions as well as address those compatibility needs.

A ZKsync-based suite could allow banks to experiment with blockchains and choose which validators can run said blockchain, Boon-Hiang Chan, Deutsche Bank’s Asia Pacific applied innovation leader, told Bloomberg. The L2 blockchain could also give regulators “super administrator rights,” allowing them to look deeper into the movement of funds, Chan said.

Memento Blockchain announced On November 6, L2 attempted, but received little attention at the time. The chain is currently in a test network environment. It is built with ZK Stack, a custom toolkit that allows developers to create their own blockchains based on ZKsync technology.

Part of L2 Dama 2, multi-chain initiative Led by Deutsche Bank. Dama 2, in turn, is part of the Monetary Authority of Singapore’s Project Guardian program, which brings together 24 major financial institutions that are exploring ways to use blockchains to tokenize their assets.

Read more: Deutsche Bank Invests in Blockchain Payment Network Partor