Leveraging blockchain technology requires access to a blockchain platform. Public or permissionless blockchain platforms, however, have limitations for financial enterprise transactions, creating privacy concerns by enabling everybody on the blockchain to have visibility of all transactions.
Additionally, the sheer vastness of potential transactions requires a substantial amount of computational power, which can slow transaction processing times. To address these limitations, private and permissioned blockchain platforms were developed by financial technology companies. A private, single organization blockchain has limitations outside that organization, but can be used to enhance internal transaction processing.
Realizing these limitations, larger organizations have developed cooperative networks or consortiums that leverage a shared blockchain platform, but that is not public to any entity outside the consortium. These consortiums are comprised of organizations with similar or complementary services with the objective of optimizing processes with known entities. This provides many of the same benefits affiliated with a single organization private blockchain — efficiency and transaction privacy, for example — without consolidating power with only one company.
The first bank-backed consortium, R3CEV, was established in September 2015. There are now more than 100 types of consortia in the blockchain area.
Primary U.S.-centric Blockchain Consortia in Financial Services (August 2017)
| Event | Winners | Runner-Up |
|---|---|---|
| Chess | Naga Sandeep Mullangi | Ramasani Sowmith |
| Table Tennis Men | Madan Kumar Mothkur | Hemanth Sreenu Neelam |
| Table Tennis Women | Naga Pujitha Mummidivarapu | Sandhya Rani Meesala |
| Badminton Doubles Men | Madan Kumar Mothkur, Sasi Pavan Darapureddy | Naga Sandeep Mullangi, Pramod Sagar Kolakani |
| Badminton Doubles Women | Sai Keerthana Anumandla, Adhira Sobha | Aadela Nishat, Hiba Naaz |
Looking ahead as multiple versions of blockchain networks grow, standards for interoperability between blockchains will become increasingly important. Consortia that base their blockchain technology on public chains will adapt more easily to these standards.
If you are interested in learning more about blockchain, download our new guide titled “Getting Ahead with Blockchain in Financial Services.”
On-Demand Webinar
Many organizations are finding blockchain to be as confusing as it is promising. We cut through the hype and shared a practical way to get started, including how to determine where it fits within your organization. We covered the following in our on-demand webinar:
- Why adopt the technology?
- What makes a good use case?
- What are some specific industry applications?
- What are the best practices for getting started?
