R3 Reveals New Blockchain Platform Called Corda

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The CTO of R3, Richard G Brown, has revealed today they are working on a distributed ledger platform for financial services called Corda.

I’m delighted to confirm that R3 and our member banks are working on a distributed ledger platform for financial services: Corda.

For the last six months, my team and contributors from our membership have been building a distributed ledger platform prototype from the ground up, specifically designed to manage financial agreements between regulated financial institutions. I am massively excited by the progress our team, led by James Carlyle, our Chief Engineer, and Mike Hearn, our Lead Platform Engineer, are making and I think the time is right to share some details.

Corda: A Distributed Ledger for Recording and Managing Financial Agreements

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Corda is a distributed ledger platform designed from the ground up to record, manage and synchronise financial agreements between regulated financial institutions. It is heavily inspired by and captures the benefits of blockchain systems, without the design choices that make blockchains inappropriate for many banking scenarios.

Corda’s key features include:

  • Corda has no unnecessary global sharing of data: only those parties with a legitimate need to know can see the data within an agreement
  • Corda choreographs workflow between firms without a central controller
  • Corda achieves consensus between firms at the level of individual deals, not the level of the system
  • Corda’s design directly enables regulatory and supervisory observer nodes
  • Corda transactions are validated by parties to the transaction rather than a broader pool of unrelated validators
  • Corda supports a variety of consensus mechanisms
  • Corda records an explicit link between human-language legal prose documents and smart contract code
  • Corda is built on industry-standard tools
  • Corda has no native cryptocurrency

Brown goes on in the blog to talk about how they will handle core elements of Blockchain technology.

On consensus:

A critical piece of the Corda philosophy is that our problem is to ensure that “I know that you see the same details about a shared fact that I see”.

But this does not mean that a third party down the road also needs to see it: our consensus occurs between parties to deals, not between all participants.

On validity:

Furthermore, in Corda, the only people who need to be in agreement about a fact are the stakeholders to that fact:  if you and I agree about something that pertains only to us then why should we care what some completely unrelated third party thinks?  And why would we even think of sending them a copy so they could opine on it? So, in Corda, we let users write their validation logic in time-tested industry-standard tools and we define who needs to be in agreement on a transaction’s validity on a contract-by-contract basis.

On uniqueness:

Just like every other distributed ledger out there, we need to be sure that two valid, but conflicting, transactions cannot both be simultaneously active in the system.  But we also recognise that different scenarios require different tradeoffs. So Corda’s design allows for a range of “uniqueness service” implementations, one of which is a “traditional blockchain”. But it doesn’t need to be and, for our purposes, we also need implementations that make different tradeoffs under Brewer’s CAP theorem: in particular, some financial services use-cases need to prioritise consistency at the expense of availability in the event of a network partition.

On immutability and authentication:

Here, Corda’s design departs very little from existing systems: our data structures are immutable and our building block is the exchange of digitally-signed transactions.

So Corda is very traditional in some respects – we directly apply the “authentication”, “immutability” and “uniqueness service” features of blockchains but we depart radically when it comes to the scope of “consensus” (parties to individual deals rather than all participants) and “validation” (the legitimate stakeholders to a deal rather than the whole universe or some arbitrary set of ‘validators’).

Corda’s design is the result of detailed analysis and prototyping with their members and will be open sourced when the code has matured further.

About Richard Kastelein

Founder and publisher of industry publication Blockchain News (EST 2015), a partner at ICO services collective Token.Agency ($750m+ and 90+ ICOs and STOs), director of education company Blockchain Partners (Oracle Partner) – Vancouver native Richard Kastelein is an award-winning publisher, innovation executive and entrepreneur. He sits on the advisory boards of some two dozen Blockchain startups and has written over 1500 articles on Blockchain technology and startups at Blockchain News and has also published pioneering articles on ICOs in Harvard Business Review and Venturebeat. Irish Tech News put him in the top 10 Token Architects in Europe.

Kastelein has an Ad Honorem - Honorary Ph.D. and is Chair Professor of Blockchain at China's first Blockchain University in Nanchang at the Jiangxi Ahead Institute of Software and Technology. In 2018 he was invited to and attended University of Oxford's Saïd Business School for Business Automation 4.0 programme.  Over a half a decade experience judging and rewarding some 1000+ innovation projects as an EU expert for the European Commission's SME Instrument programme as a startup assessor and as a startup judge for the UK government's Innovate UK division.

Kastelein has spoken (keynotes & panels) on Blockchain technology in Amsterdam, Antwerp, Barcelona, Beijing, Brussels, Bucharest, Dubai, Eindhoven, Gdansk, Groningen, the Hague, Helsinki, London (5x), Manchester, Minsk, Nairobi, Nanchang, Prague, San Mateo, San Francisco, Santa Clara (2x), Shanghai, Singapore (3x), Tel Aviv, Utrecht, Venice, Visakhapatnam, Zwolle and Zurich.

He is a Canadian (Dutch/Irish/English/Métis) whose writing career has ranged from the Canadian Native Press (Arctic) to the Caribbean & Europe. He's written occasionally for Harvard Business Review, Wired, Venturebeat, The Guardian and Virgin.com, and his work and ideas have been translated into Dutch, Greek, Polish, German and French. A journalist by trade, an entrepreneur and adventurer at heart, Kastelein's professional career has ranged from political publishing to TV technology, boatbuilding to judging startups, skippering yachts to marketing and more as he's travelled for nearly 30 years as a Canadian expatriate living around the world. In his 20s, he sailed around the world on small yachts and wrote a series of travel articles called, 'The Hitchhiker's Guide to the Seas' travelling by hitching rides on yachts (1989) in major travel and yachting publications. He currently lives in Groningen, Netherlands where he's raising three teenage daughters with his wife and sailing partner, Wieke Beenen.

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