The Bank of England said Tuesday that it is undertaking a new proof-of-concept to explore the ways its planned real-time gross settlement (RTGS) system could connect with distributed ledger networks.

The U.K. central bank first announced its intentions to develop a DLT-compatible service in 2017, having previously said that it wouldn't move to base the system on the tech outright – a decision it referenced in this week's announcement.

"Although the Bank has concluded that distributed ledger technology (DLT) is not yet sufficiently mature to provide the core for the next generation of RTGS," a statement said, "it places a high priority on ensuring that the new service is capable of interfacing with DLT as and when it is developed in the wider sterling markets."

Specifically, the project's participants will examine whether "innovative settlement systems," such as those based on DLT, are able to interact with its proposed 'renewed' cloud-based RTGS service. Project participants include payments technology providers Baton Systems and Token, R3 and Clearmatics.

It will also aim to pinpoint ways in which the service's "functionality could be expanded" through the use of new technologies.

The UK central bank said that it hopes the firms' involvement will "give broader insight into the range of functionality the Bank might need to offer to support this sector."

The Bank of England plans to issue a report on the results of the proof-of-concept later this year.

Bank of England image via Shutterstock