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Blockchain Platform Developed by Banks To Be Open-Source (reuters.com)
A blockchain platform developed by a group that includes more than 70 of the world's biggest financial institutions is making its code publicly available, in what could become the industry standard for the nascent technology, reports Reuters. From the article: The Corda platform has been developed by a consortium brought together by New-York-based financial technology company R3. It represents the biggest shared effort among banks, insurers, fund managers and other players to work on using blockchain technology in the financial markets. Blockchain, which originated in the digital currency bitcoin, works as a web-based transaction-processing and settlement system. It creates 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. Banks reckon the technology could save them money by making their operations faster, more efficient and more transparent. They are racing to build products using the technology that will generate new revenue, with dozens of patent applications filed for blockchain-based products by Wall Street's top lenders. R3 says it hopes its platform will become the industry standard, although its intention is indeed for firms to build products on top of it.
The big deal is about big transactions. This most likely isn't going to be used in the consumer credit card / debit card market, but more likely in the large purchase department. Buying a car/house? Waiting a few minutes vs hours/days for credit reports to return. Transferring millions/billions of dollars between accounts, who's auditing it? Blockchains significantly reduce the amount of work in this department while essentially eliminating fraud, since the dollars can be tracked from transaction to transaction.
I have written Haskoin, a Haskell implementation of the Bitcoin protocol. I have consulted for a large bank and various interested organizations on "blockchain" technology. There is really nothing to see here. Bankers are scared of Bitcoin. They're trying to get some of the attention and changing the tune to that of "blockchain". Some of them believe (or lead others to believe) that they can do something with this blockchain technology, but virtually nobody understand how any of it works. My opinion is that bankers are very specialized salesmen who know about making deals. Bitcoin to them is just a bunch of startups working with blockchain technology, which is treated as some generic buzzword that they can attach to some of their offerings if they just use some setup that has some passing resemblance to the Bitcoin system. It is all very weird, like having a horse attached to a contraption involving pedals on a four-wheeled vehicle and call it a car. In all my time doing consulting around this blockchain stuff I did not find one use case that merited the use of anything remotely resembling Bitcoin. Banks rely on secrecy, identity, and they have to respect lots of different regulations and restrictions, also their software needs to change very often. An open database on the Internet for everyone to see running on very basic stable software is not going to fly for any of their requirements. Blockchains in banks are an oxymoron.