Finance heavy-weights have joined forces on a new blockchain network that they say gets rid of the constraints of previous efforts, including privacy and scalability.
Big institutions like BNP Paribas, Goldman Sachs, and S&P Global just announced their plans to launch a privacy-enabled, interoperable blockchain network for financial markets.
A group of big FinServs has agreed that it’s better when they’re together, at least on the blockchain.
More than two dozen participants are set to launch the Canton Network this summer, according to a recent announcement, including a handful of financial institutions. It’s a “network-of-networks” in that it connects and makes interoperable any application built with Daml, a smart-contract language created by Digital Asset.
The blockchain-based network captures “the benefits of public blockchains, without the flaws,” the group says, by balancing decentralization with privacy and interoperability.
Public, layer 1 blockchains require full transparency, while private blockchains lose interoperability, a spokesperson told Distilled. Its solution allows highly regulated financial firms to run their own applications, with their own permissions, while being able to connect with other apps: “The Canton Network offers a third option apart from the public or private blockchain boxes. That is the North Star we are trying to provide for everybody.”
After all, FinServs have realized that the interoperability and synchronization of their efforts is key to success, and the heyday of their widespread blockchain experimentation has given way to more focused, consolidated efforts.
The Canton Network can be used for the issue and settlement of digital bonds or other tokenized assets, while ubiquitous bank-to-bank messaging platform Swift recently trialed a blockchain-based application with six other securities participants, including Citi and Northern Trust, for communicating corporate events, like tender offers or stock splits.