By Michael del Castillio fr Coindesk
A consortium of over 40 financial institutions around the world is currently working on at least eight different proofs-of-concept (PoCs) to show how distributed ledgers can be used to streamline a wide range of transactions on Wall Street – and make them easier to regulate.
Speaking at the Blockchain & Distributed Ledger Conference today, an executive for R3CEV, the startup behind the consortium, listed off eight different areas for which his company was promoting work on proofs-of-concept. These include system interoperability, payments, settlement, trade finance, corporate bonds, repos, swaps, and insurance.
Jacob Farber, general counsel for R3, told attendees:
“We have groups of financial institutions engaged in proof of concepts or working on scoping the proof of concept in each of those areas”
The comments come after R3 revealed its plans for Corda, a distributed ledger designed with an eye to the specific privacy requirements unique to financial institutions.
Disruption, not replacement
Farber, who previously worked at law firm Perkins Coie – which co-chaired the conference along with American Express – emphasized that the projects in these areas were not intended to replace the entire category in any instance.
Instead, the PoCs will take subsets of the services and try to write them into its distributed ledger.
Specifically, Farber mentioned post-trade reporting, reference data, and regulatory data provision as especially intriguing applications.
“There’s all sorts of interesting applications on blockchain that are well short of replacing the whole cradle to grave process,” said Farber.
In other remarks, Farber took issue with the term “smart contracts,” used to describe legal agreements enshrined into a blockchain, codifying certain obligations that are triggered once a predetermined set of events takes place.
“People call it smart contracts. It’s a name I hate, because they’re not really contracts [and] they’re not really smart.”
Similarly, in a panel on the subject the previous day, Patrick Murck, fellow at Harvard’s Berkman Center for Internet & Society and former executive director of the bitcoin industry trade group the Bitcoin Foundation, said he “chafes” at the term, coined by Nick Szabo in 1997.
Murck offered the alternative “programmatic transactions”, explaining that the contracts almost always have a traditional counterpart contract, and are only mechanical implementations that are already possible using more traditional technology.
Today was the last day of the two-day conference hosted by the American Conference Institute that spanned a wide range of topics from law enforcement to the position of regulators in the blockchain space to the nature of smart contracts.
Image by Michael del Castillo for CoinDesk
First appeared in Coindesk