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October 31, 2017

Biggest global banks and R3 create blockchain payments platform

The new platform is intended to not only handle traditional central bank currencies, but also cryptocurrencies.

By Tom Ball

Major blockchain development player, R3, with 22 global banks including HSBC and Barclays, has announced the creation of a payments platform with the technology at its core.

While the platform will enhance the international transaction process for traditional central bank currencies, the system will also include cryptocurrencies, a bold move to bring both technologies to the fore.

The group aims to release a prototype of the new system by the end of the year, a move that would be an important milestone in the development of blockchain, with the technology yet to break out of the nascent category.

Biggest global banks and R3 create blockchain payments platformDigital currencies have become increasingly popular, with Bitcoin continuing to break price records, but China, South Korea, Russia and now Vietnam have recently imposed stringent restrictions on their use. This could potentially slow the rise to prominence of the digital currencies targeted by this new blockchain payments platform.

R3 is known for hosting one of the largest blockchain consortiums in the world, on a scale comparable to the Enterprise Ethereum Alliance .

Blockchain is expected to be disruptive across many industries, stripping away arduous complexity associated with traditional processes, while also improving accuracy. While the news is exciting, many believe that blockchain is not yet well established enough to handle such tasks.

Many of the world’s largest organisations are engaged in the development of blockchain technology, IBM and JPMorgan are driving forces that are constantly engaged in its testing.

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Banks have often been at the core of work to bring about a widespread implementation of blockchain, and another recent example of their engagement specifically targets small and medium sized organisations.

Banks including HSBC, Deutsche Bank and Societe Generale are working together on an international trade use case for blockchain, aiming to empower the cross-border trade capabilities of SMEs.

JPMorgan is also looking to leverage blockchain technology for payments, aiming to make efficiency and security central attributes of the new network the major firm is working on. JPMorgan is not alone in this task, with the Royal Bank of Canada contributing to the development of the network.

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