The growing numbers of banks are paying active attention to blockchain technology and various use cases for financial institutions. The range of activities around blockchain technology will expand as banks will start working on open-source software that can serve as the base for building new applications.
The Linux Foundation, a nonprofit organization enabling mass innovation through open source, today announced a new collaborative effort of the financial and tech industries giants to advance the blockchain technology called the Open Ledger Project. The project will develop an enterprise grade, open-source distributed ledger framework and free developers to focus on building robust, industry-specific applications, platforms and hardware systems to support business transactions, as stated in the official press release.
As Jim Zemlin, Executive Director at The Linux Foundation, shared in the release, “Distributed ledgers are poised to transform a wide range of industries from banking and shipping to the Internet of Things, among others. As with any early-stage, highly-complex technology that demonstrates the ability to change the way we live our lives and conduct business, blockchain demands a cross-industry, open-source collaboration to advance the technology for all.”
Among companies who already committed to join the Open Ledger Project are Accenture, ANZ Bank, Cisco, CLS, Credits, Deutsche Börse, Digital Asset Holdings, DTCC, Eris Industries, Fujitsu, IC3, IBM, Intel, JPMorgan, London Stock Exchange Group, Mitsubishi UFJ Financial Group, R3, State Street, SWIFT, VMware and Wells Fargo.
The interest from those companies is related to the opportunities blockchain technology opens. Blockchain technology can enable major advancements in the speed and security of financial services, it allows securities to be settled in minutes instead of days; it can be used to help companies manage the flow of goods and related payments or enable manufacturers to share production logs with regulators to reduce product recalls. There is a wide range of applications for blockchain technology, and the Open Ledger Project is another step of the industry leaders in adopting it.
Founding members demonstrated deep commitment by contributing their own extensive research on blockchain and significant resources. IBM will share tens of thousands of lines of its existing codebase and its corresponding intellectual property. Digital Asset is contributing the Hyperledger mark, which will be used as the project name, as well as enterprise grade code and developer resources. R3 is contributing a new financial transaction architectural framework designed to specifically meet the requirements of its global bank members and other financial institutions.
The Open Ledger Project will foster the identification of important features and currently missing requirements for a cross-industry open standard for distributed ledgers, which can potentially revolutionize the way business transactions are conducted globally.
Imad Sousou, VP and General Manager at Open Source Technology Center, Intel Corporation, commented on the opportunities open-source software provides, "Open source software is very well suited to be the basis of highly complex technologies that require secure transactions. The open ledger project can help enable the industry to focus on a shared infrastructure to help create value and impactful innovation."
One of the financial institutions, ANZ Bank, has a strong interest in exploring opportunities for banks with blockchain. Nigel Dobson, ANZ’s General Manager of Payments Transformation said he sees involvement with the project as an opportunity to explore and contribute to real-world, bank-grade applications of the technology and wider frameworks. “I see significant potential opportunities in the future to improve our customer experience and potentially deliver productivity gains by solving real business challenges, with initial use cases in payments and particularly correspondent banking.”