Unite Global partners with WOCU for centralised currency
EXCLUSIVE. Norway’s Unite Global and WOCU will sign a formal agreement to offer the WOCU currency from the Unite hub and into the global banking system.
Unite says the WOCU (pronounced “wok-hoo”) currency will offer banking customers lowered volatility, reduced FX costs and freedom from reliance on the dollar for international trade.
This follows Unite’s plans to unleash a centralised platform for global real-time payments and settlement between banks, as FinTech Futures exclusively reported last month.
This platform was described by the firm’s CTO Tord Coucheron as “fully centralised” but it “does not involve blockchain in any way”.
In the latest development, Coucheron says: “With the launch of the Unite global payments hub the issuance of WOCU currency will be a perfect fit for us. Together we can deliver the perfect solution to the pressing need for a mainstream global payments currency that is relatively stable, fast and compliant.”
The currency will be issued by a regular FX transaction. Once issued, it may be transferred and exchanged in secondary trades in the regular banking system, like any other fiat currency.
Its global currency quotation is derived from the real-time exchange rates of the currencies of the top 20 countries as measured by GDP (five of them using the Euro), covering just over 80% of global production.
Country weightings are adjusted biannually on set dates. This means that the WOCU, compared to the dollar or any other floating currency, is a reduced volatility reference.
Tom Barr, CEO of WOCU Limited, explains: “We had firm interest from numerous banks, corporates and exchanges, all of which were essential to make it happen and all of which loved the WOCU concept. The problem was the barrier to execution: we had to simultaneously spin too many impossibly heavy institutional plates to get to a WOCU currency.”
WOCU FX conversion proceeds will be invested into a dedicated WOCU Reserve Fund managed by a sovereign wealth fund. It is expected that a proportion of the WOCU reserve and investment surpluses will be used for “global social good”.
WOCU remarks that its currency will bear no similarity to cryptocurrencies, not only as it’s backed by fiat currencies, but also doesn’t rely on blockchain.