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Banking consortium R3 has pushed blockchain technology closer to production with the launch of its distributed ledger technology platform (DLT) platform, Corda v1.0, and called on banks to “make your choice”.
The platform, which the company describes as “blockchain inspired”, has been developed over two years with members of the consortium and will enable institutions to transact directly using smart contracts. As an open source platform, third parties can develop and implement applications, known as CorDappsusing Corda’s common code and protocols.
Corda v1.0 follows the open source release of the platform last year. R3 says it has now achieved stability of Corda’s core application programming interface (API) allowing for third parties to develop applications for the platform, with a guarantee that any future changes will not disrupt their work.
“The blockchain industry in reality is still quite young,” says R3 CTO Richard Brown to GTR.
“Many of these platforms are changing quite rapidly. What we delivered today will allow developers to plan and predict and hit deadlines. We committed today to keep the core designs, the foundations if you like, fixed. Which gives huge predictability and huge confidence to those building on top of it.”
Brown explains that by fixing the foundations, R3 has given away the right to change key parts later.
“I am aware of platforms that have plans to make quite significant changes that will force application developers to change their applications. We had to be very sure that our design was right and stable. It’s a big step and to my knowledge we are the first blockchain firm to make that commitment.”
“Time to make your choice”
Other platforms are also in the race to become the primary platform for trade finance. In July, Hyperledger released Fabric 1.0, which is backed by Linux open source technology, and also designed to be used for transactional operations.
In June, a consortium of seven banks announced they had chosen IBM to develop Digital Trade Chain (DTC), a blockchain trade finance platform for SMEs. When faced with a choice between Fabric and Corda, the developers went for Fabric 1.0.
Swift has also been working on a proof of concept (PoC) with the beta version of 1.0, for its nostro account reconciliation tool, within its global payments innovation (gpi) initiative.
Last month, R3 announced it has partnered with fintech firm TradeIX and 12 international banks to develop an open account trade finance application that will operate on Corda. The application will be co-developed with logistics companies and industry parties such as the ICC Banking Commission and the International Trade and Forfaiting Association (ITFA). However, the early users of the application will be only banks and their corporate clients.
As the race heats up, Brown argues that the roadmap for large-scale deployment is now clear and that it is time for developers and entities “to make your choice”.
“The whole idea of these platforms is to allow the users to reduce their costs and share data with privacy with their peers. If lots and lots of incompatible platforms get deployed it doesn’t work,” he says.
“If you work through just the economics of this, it all points to a small number of platforms gaining widespread adoption. [However,] it won’t be one – different platforms solve different problems, so it will be three or four different platforms.”
Commenting on Hyperledger’s release earlier this year, and the selection of Fabric 1.0 by DTC, Brown says that as premier members of the Hyperledger project, R3, like in all businesses, both competes and collaborates with different organisations: “With respect to Fabric, I think we’ve set ourselves on a deliberately different course. The way that Corda is being designed, the problems we are trying to solve and the approach we’ve taken is different. There are multiple platforms in the market for different use cases. I don’t expect Corda to be selected for each and every one of them.”
Diverse and rapid uptake expected
Having deliberately designed Corda for its members, predominantly large banks, the consortium says it has also seen a lot of engagement from other sectors including insurance, health care and government entities, as well as a large number of smaller scale startups.
“We have discovered through the open source community that people are finding use cases for it outside its original purpose. This tells me we have hit on the right design – if people are independently discovering that it’s capable of delivering,” says Brown.
With the launch of Corda v1.0, R3 now expects to see a ramp up in production deployment. So far numerous PoCs and pilots have been tested on the platform, which are now expected to go into production stage.
“My expectation is now that we have this commitment to API stability, the ramp up will be rapid. Those who may be waiting on the sidelines can now choose to engage with confidence,” says Brown.
“I suspect in the first half of next year we will be seeing publicised production deployment and then it will ramp up further later in the year.”
Meanwhile, at R3 the company plans to work on extra features for enterprise deployment and large-scale deployment over the coming months.