Big Investment Banks Eye Blockchain Standards

Wall Street can’t seem to get enough of blockchain technology.

Just last week it was announced that a group of major financial companies agreed to invest $30 million in Chain, a San Francisco-based provider of blockchain technology solutions to financial institutions. The investors of that round include Visa, Nasdaq, Citi Ventures, Capital One, Fiserv and Orange SA.

Now, the big investment banks want a piece of the blockchain, too. As reported by Financial Times, the latest to back more initiatives involving blockchain technology are Goldman Sachs, JPMorgan, Credit Suisse, Barclays, Commonwealth Bank of Australia, State Street, RBS, BBVA and UBS. This new initiative involves developing a common standard for how financial institutions could leverage the technology for enhanced financial services.

This also means working with a New-York based startup group called R3CEV to gather data, new ideas and the finances needed to help get such an concept off the ground.

“This partnership signals the first significant commitment by the banks to collaboratively evaluate and apply this emerging technology to the global financial system,” David Rutter, chief executive of R3, told Financial Times.

While bitcoin gets plenty of negative press, with the help of big Wall Streeters and High Street banks, the blockchain has become a major talking point for mainstream financial institutions as a way to possibly innovate a long-standing financial industry that has room for upgrades. The blockchain, the public distribution ledger that powers bitcoin, has been viewed as a way to overhaul the underbelly of the financial system that moves money quicker and cheaper by creating a centralized authority, instead of relying on the multiple locations used to settle payments.

“If you’re looking to introduce applications with distributed ledger technologies to improve the financial markets, you can’t have each participant working to a different pattern,” Christopher Murphy, global co-head of FX, rates and credit at UBS, told Financial Times. “What R3 are doing is bringing a consensus which could establish common standards.”

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To check out what else is HOT in the world of payments, click here.

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