A number of technological and financial organizations are reportedly joining forces to create a new computing system based on the network of Ethereum, a decentralized platform for applications that backs the popular digital currency Ether.
The 30 or so businesses involved are set to announce the formation of a nonprofit organization called the Enterprise Ethereum Alliance (EEA) on Tuesday, said the New York Times. Members of the EEA reportedly include Intel, Banco Santander, BBVA, Credit Suisse, Bank of New York Mellon, Accenture, ING, Thomson Reuters and UBS, among others, who will work to create a standardized version of the Ethereum blockchain software for businesses.
Blockchain technology appeals to businesses and financial institutions because it could offer additional protections against corruption and hacking by means of its decentralized structure of information storage. Ethereum, in particular, allows users to write smart contracts into the blockchain, said NYT, among a number of other complex computing capabilities.
“In the past two years, financial services firms and technology providers have made significant strides in turning the hype around blockchain into reality,” said Corporate Insight Analyst Jennifer Butler in a statement. “Financial services firms are investing in blockchain to access its potential for reducing operational inefficiencies and increasing market transparency.”
Last month, Accenture released a report which found that blockchain technology could save the world’s 10 largest banks between $8 billion to $12 billion in annual infrastructure costs.
A survey by Infosys found that half of banks have already invested in blockchain or will do so this year, with average investments totaling $1 million. A third of the banks surveyed said they expect to see the commercial adoption of blockchain tools by next year, while the majority said it’s likely to begin by 2020. Some 80 percent of the banks surveyed by Infosys were part of some type of partnership or collaborative blockchain effort.