R3 CEV has created its blockchain-based platform Corda specially for financial sphere.
The Corda platform, a blockchain platform that has been developed by R3 consortium consisting of more than 70 global financial institutions, becomes publicly available. The news was announced by the official press release of R3 CEV.
Corda is a blockchain-based platform that restricts access to transaction data and can handle more complex transactions. R3 created it for the processing of securities and derivatives and for payments.
“Blindly investing millions of dollars in small, disparate technology projects is not appropriate for banks at a time when budgets are stretched,” said R3’s chief executive, David Rutter.
Blockchain is a unique technology that originally underlay the cryptocurrency bitcoin. However, multiple financial companies has appreciated the potential of the blockchain as it is capable to create a “golden record” of any given set of data that is automatically replicated for all parties in a secure network, eliminating any need for third-party verification. Blockchain is tested to work as a web-based transaction-processing and settlement system.
“The risk of backing the wrong horse could far outweigh the potential gains. Given that the power of this technology lies in its network effect, the consortium model is the ideal method to get it off the drawing board and into the wholesale financial markets”, Rutter said.
Banks strive to adopt the blockchain to make transactions faster, more efficient and more transparent. They compete in some way to create efficient blockchain-based products that will generate new revenue, with dozens of patent applications filed for blockchain-based products by Wall Street’s top lenders.
R3 positions its Corda platform as the industry standard and wants other companies to build products on top of it.
“We want other banks and other parties to innovate with products that sit on top of the platform, but we don’t want everyone to create their own platform … because we’ll end up with lots of islands that can’t talk to each other,” said R3’s chief engineer, James Carlyle.
“If we have one platform with lots of products on top, then we get something that’s more like the internet, where we still get innovation but we can still communicate with each other.”
R3 reveals that Corda’s code will be contributed to the Hyperledger project, a project aimed at blockchain adoption, on November 30.
Last month, R3 CEV and eight members of its blockchain consortium completed the trial of the distributed ledger prototype for US treasury bonds trading. The prototype was an implementation of Intel’s proprietary blockchain platform, called Sawtooth Lake.
The banks participating in the trial include CIBC, UniCredit, ING, Societe Generale, HSBC, Scotiabank, State Street, and UBS.