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Wall Street Blockchain Alliance Joins Enterprise Blockchain Consortium R3

The Wall Street Blockchain Alliance will partner with R3 to develop solutions on their Corda blockchain platform.

The Wall Street Blockchain Alliance (WSBA) has joined blockchain consortium R3 to develop applications and solutions on their Corda platform, a Feb. 5 press release reports.

According to a statement made by the CEO of R3, David E. Rutter, the WSBA and R3 will collaborate in order to “advocate a strategic approach to collaborating with regulatory bodies so that financial markets, and beyond can gain the full benefits of blockchain’s capabilities.”

The WSBA is a non-profit trade association that promotes the general adoption of blockchain technology and crypto assets across international markets.

R3, an enterprise blockchain software firm with over 300 partners, has developed Corda, an open-source blockchain platform for both the private and public sectors across multiple industries. Corda is a blockchain platform that allows for institutions to transact directly with the usage of smart contracts while ensuring their user’s privacy and security.

In mid-January, R3 announced the launch of its Corda Network, with non-for-profit organization the Corda Network Foundation responsible for its operations.

On Jan. 30, Cointelegraph reported that Japanese financial company SBI Holdings would also partner with R3 as they aim to help them develop the local use of Corda blockchain on their platform.

Also at the end of January, major global banking payments network SWIFT revealed its plans to develop a Proof-of-Concept gateway that would allow R3 to link to the SWIFT Global Payments Innovation payments from their platform.

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XRP Price Pumps As SWIFT Partners With Ripple Rival R3

The CEO of SWIFT revealed today that the institution is working on a proof-of-concept for integrating blockchain start-up’s R3 trade finance platform with SWIFT’s GPI framework. 


Proof-of-Concept Blockchain Integration

The Society for Worldwide Interbank Financial Telecommunication (SWIFT) is a global banking payments network. It works with over 11,000 institutions and moves an estimated $200 billion every day.

Today, speaking at the Paris Fintech Forum, the company’s CEO, Gottfried Leibbrandt, revealed that they are working on a proof-of-concept for integrating R3’s blockchain-based trade finance platform with SWIFT’s Global Payments Innovation (GPI) framework. Leibbrandt said:

We are announcing later today a proof-of-concept with the R3 blockchain on trade where you can initiate a payment on the trade platform and then it goes into GPI. We’re exploring interconnectivity with a lot of things and banks have always been a part of that interconnectivity.

The GPI initiative was introduced by SWIFT back in 2017 and it’s intended to speed up payment-processing times, lower the costs and increase transparency. However, it relies predominantly on currently existing infrastructure and as such, it can be rather slow and expensive.

Shots Fired

Leibbrandt was speaking on stage right next to Ripple’s CEO Brad Garlinghouse. The latter has previously criticized SWIFT for its high published error rate, saying:

SWIFT’s published error rate is six percent. Imagine if six percent of your emails didn’t go through without additional human intervention.

Garlinghouse didn’t miss the chance to highlight the benefits of decentralization, while also outlining some of SWIFT’s weak points:

Swift today is a one-way messaging framework, it isn’t a liquidity provider. When we think about an internet of value, it’s a mixture of two-way messaging frameworks — moving to a real-time chatting protocol if you will — coupled with real-time liquidity.

On the other hand, Leibbrandt said that his company’s historic reluctance about blockchain has been fueled additionally by volatile swings and sharp declines in the price of cryptocurrency.

He also outlined that a large part of Ripple’s value proposition is XRP – the cryptocurrency and that banks are reluctant to convert because of the volatility.

While none of them hinted at a potential near-term partnership, Garlinghouse said that they are open to “ways we could work with SWIFT.”

It’s worth noting, however, that last year R3 launched an application aimed to enhance global cryptocurrency payments, Corda Settler, the first settlement mechanism that it decided to use was XRP.

And while R3 and Ripple are technically competitors, following SWIFT’s announcement the price of XRP 00 marks 8.8% increase at the time of this writing.

What do you think of SWIFT’s announcement? Don’t hesitate to let us know in the comments below!


Images courtesy of Shutterstock

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2 Executives Are Leaving Blockchain Startup R3 in Management Shake-Up

Distributed ledger technology provider R3 has carried out an extensive internal reorganization, resulting in the departure of two members of its management committee, CoinDesk has learned.

Brian McNulty, a managing director and head of global services, and Lauren Carroll, chief administrative officer, are leaving the company, R3 told employees at town hall meetings Friday, according to people familiar with the situation.

An R3 spokesperson confirmed the internal reorganization, which he said will include an expansive hiring program for 2019, but declined to comment on individual staff departures. Neither McNulty nor Carroll answered requests for comment by press time.

McNulty joined R3 in March 2016 when the start-up was busy onboarding consortium member banks. He had previously founded the PTDL (Post Trade Distributed Ledger) Group, a rival blockchain group which numbered around 40 members including CME Group, State Street Bank and the London Stock Exchange.

Carroll was formerly in-house counsel at ICAP before transitioning into business management roles at the electronic trading firm.

New team structure

As part of the reorganization, co-founder Todd McDonald will run a new “design” team that combines all of R3’s product and marketing efforts, according to a memo CEO David Rutter sent the company’s roughly 200 employees after Friday’s town hall meetings.

Product management was previously in the same division as engineering, which Richard Gendal Brown will continue to lead.

The memo also outlined several other changes:

  • Chief engineer James Carlyle will run a new “production” team dedicated to supporting the deployment of R3’s technology at client companies.
  • The general counsel’s office has been merged with external affairs and placed under Charley Cooper, who has long overseen regulatory affairs and public relations for R3.
  • Chief of staff Zack Kavanaugh assumed added responsibilities for recruiting, HR and business resources.
  • Chief financial officer (CFO) Paul Harris will oversee a combined finance and corporate development (M&A team.
  • A search is underway for a chief revenue officer (CRO) to lead the sales team. As CoinDesk reported earlier this month, Scott Grayson, R3’s former chief sales officer, left in September and recently joined the blockchain services firm AlphaPoint.

In June 2018 R3 had to field media speculation that the company was running short of funds. More recently, a legal dispute with Ripple concerning a contract to purchase five billion XRP tokens was resolved.

Image: R3 founder David Rutter at Consensus, from CoinDesk archives

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SBI Holdings, R3 Embark on ‘Joint Venture’ to Boost Corda Blockchain Use in Asia

R3’s Corda platform aims for an adoption boost via a partnership with Japanese financial services giant SBI Holdings.

Japanese financial services company SBI Holdings will partner with software firm R3 to expand local use of its Corda blockchain platform, Cointelegraph Japan reported Dec. 5.

Quoting local news outlet Nikkei, the report reveals that SBI, which is involved in multiple cryptocurrency and blockchain-related activities, will expand on its existing investment in R3 to create a “joint venture” aimed at promotion.

“Europe is the most advanced in blockchain product development,” R3 CEO David Rutter told Nikkei in an interview:

“The new joint venture will strengthen the Japanese language service, and promote adoption.”

The company added its R3 partnership would extend beyond Japan to cover the wider Asian space.

R3 focuses on using Distributed Ledger Technologies (DLT), such as blockchain, to facilitate efficiency increases primarily for banking partners. Based in the United States, the startup has clients throughout the world, which currently number around 200.

Deals continue to come, Cointelegraph this week reporting on a group of French banks completing a Corda-based Know Your Customer (KYC) trial, while R3 also announced that the first cryptocurrency added to its payments DApp would be Ripple (XRP).

SBI is also deeply entrenched in XRP, its joint money transfer operation SBI Ripple Asia gaining Japanese regulatory approval in September.

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Amber Baldet: Don’t Force Public Blockchains ‘Down Enterprises’ Throats’

Having left one of the world’s largest financial institutions to build an ethereum startup, Amber Baldet appreciates both the needs of enterprises and the potential of open, decentralized blockchains.

But in the Clovyr co-founder’s view, it’s too soon for the former to start doing much with the latter.

“We want to build those bridges out to the public networks, but I don’t think you get there by shoving public chains down enterprises’ throats before they are ready,” Baldet told CoinDesk.

Rather, a gradual process of bridge-building between public chains and the private kind favored by corporations is needed, believes Baldet. This is the task Clovyr was designed to perform, while keeping decentralization front and centre.

“Until there is credible on-chain privacy or very well-designed privacy preserving architectures for enterprise applications on public chains, it’s a bit premature,” said Baldet, who oversaw the creation of Quorum, the private and privacy-centric fork of ethereum, when she was the blockchain lead at global megabank JPMorgan Chase.

Her comments come as enterprises, once dead-set against public chains, are tentatively exploring the possibilities there. The 500-member Enterprise Ethereum Alliance, for instance, is developing standards which will port privacy-enhancing modifications into ethereum, and global consulting firm EY has championed enterprise use of public chains.

On the other hand, some enterprise blockchain builders, such as the R3 banking consortium, believe the full-broadcast design of public chains, which is naturally disposed to sharing data with other nodes, is fundamentally the wrong architecture for businesses.

Another immediate concern is scale: Baldet said a single large enterprise moving any portion of its core operations to the ethereum blockchain would shut it down faster than CryptoKitties, the popular tokenized cat game that inundated the network with transactions.

Rather than being overloaded with computational complexity and burdened with a ton of smart contacts, a better endpoint for the public ethereum network is to be “a connective fabric between things that are happening elsewhere,” said Baldet, who chatted with CoinDesk while in London to cement her commitment to the Fintech Open Source Foundation (FINOS), a project to ensure financial services does not lag behind other industries in adopting open source practises.

Baldet and former lead Quorum engineer Patrick Nielsen launched Clovyr in May. Since then, Baldet said, it’s got some partnerships are in the pipeline, though none are ready to announce.

Earlier this month at Devcon 4, Clovyr released its first standalone tool, a code search for ethereum developers writing smart contracts in Solidity, the programming language.

‘Privacy-first’

Even in her banking days, Baldet espoused cypherpunk ideals about privacy. In her view, it is critical, not only so enterprises can protect their secret sauces, but also for human consent over how the data we generate is handled.

Hence, Baldet wants to make building and connecting decentralized applications (not necessarily blockchain-based ones) easy and intuitive, while eschewing centrally controlled, data-hungry surveillance capitalism.

Yet Clovyr also takes a practical approach. An example, said Baldet, could be something simple like creating a workflow for document signing and verification across different entities within a business, where DocuSign might have been previously used.

In that scenario, “you don’t need to do a $20 million infrastructure lift of an existing application, so much as you simply enable that connectivity – and from there it’s a more organic way to build the ‘blockchain use case.’ You don’t need to get 10 organizations around a table with a bunch of lawyers and spend six months deciding everything up front,” said Baldet.

While the blockchains being built by enterprise consortiums like R3 and Hyperledger will solve business problems of their target demographic, there’s much more on offer, she said, adding:

“What we have right now is great for the 1 percent of businesses that can afford the expensive consultants and pay for the use case creation.”

But like history, software development moves in cycles. ColdFusion, a scripting language used for web development in the 1990s, required expensive consultants, noted Baldet. Thereafter, a rapid period of evolution led to a point where thousands of mom-and-pop shops were registering dot-com addresses with reusable e-commerce carts they didn’t build themselves.

“So we want to create those reusable components that dramatically lower the barrier to entry for the 99.99% of people in the world who have not even begun to explore what blockchain can mean to their business,” Baldet said.

Regarding Clovyr’s business model, Baldet said she wanted to clarify that it is not a “dapp store” nor is it a pure interoperability play like Hyperledger Quilt or Polkadot.

And while Clovyr makes it easier to search libraries and use them to spin up networks, Baldet is careful not to have the model conflated with the notion of “blockchain-as-a-service.”

“Right now, what we have is everything that is ‘as a service’ comes to you from a central provider. Yes, we are creating that experience for developers, but we are not trying to create an intermediary that forces what they build to constantly phone home to Clovyr,” she said, concluding:

“Delivering the usability modern developers expect in a privacy-first way isn’t easy, but it’s a problem worth solving.”

Amber Baldet with Bob Underwood of FINOS photo via Ian Allison for CoinDesk