Swiss bank UBS AG said it is leading a team of four of the world's biggest banks developing a potentially revolutionary system to enable the financial markets to make payments and settle transactions quickly using what it called blockchain technology.

UBS has developed a "Utility Settlement Coin" or USC, which is a digital cash equivalent of each of the major currencies backed by central banks, such as the dollar or euro, rather than a decentralized new digital currency such as bitcoin.

The USC would be convertible at parity with a bank deposit in the corresponding currency, making it fully backed by cash assets at a central bank. Spending a USC would be the same as spending the real currency it is paired with, UBS said.