I’m absolutely thrilled to be able to write about the open sourcing of Project Ubin Phase II, a key project that our team has been working on for the past seven months with the Monetary Authority of Singapore (MAS), ten banks, and our partner Accenture.
Ubin Phase 2 report
What is Project Ubin? It’s probably the most advanced starter kit out there for anyone wanting to explore blockchains for banking:
This article was first posted on r3.com
Over the past couple of years, R3 has worked closely with a number of central banks to explore if distributed ledgers could support their policy goals, and I have had the privilege to participate in a number of these projects.
What have we learnt? What is important? What do central banks care about? While I can’t speak directly for individual organisations, I have collated my own thoughts, and wanted to share these ahead of the Singapore FinTech Festival this year (13-17 Nov) when the results of Singapore’s “Project Ubin” experiments will be announced.
Update (post FinTech Festival): Read about the Open Sourcing of “Corda for Central Banks“!
There has been a lot of hype around central banks, interbank payments, blockchains, and central bank digital currencies (CBDCs), but the narrative has become confusing and often misses the point. What’s going on? Actually two independent things are being actively explored:
I aim to explain them both in this post.
This short post gives an overview on how blockchains could impact financial inclusion and “banking the unbanked”. There are two parts to this:
At conferences and events I often get asked a variation of “Is blockchain regulated?”. The short answer is no: technology is rarely regulated. It’s entities who are regulated (especially in finance).
Blockchains and Laws: are they compatible? A paper I coauthored at R3 with Baker Mckenzie.
Banks need their technology to conform to certain standards – resilience, security, and so on. The banks (not the technology!) get penalised if they can’t demonstrate high standards with the technology they choose to deploy. A common rulebook that is adapted for each jurisdiction is called Principles for Financial Market Infrastructures.
But blockchains and distributed ledgers share data, and often business is conducted across borders. And many countries have data protection laws specifying that certain types of data (eg personally identifying data) need to remain stored on computers within the borders of the country itself. How do we reconcile data sharing with data protection laws?
Well, instead of thinking about blockchains and distributed ledgers as a mechanism for sharing data (we know data sharing is a solved problem), think of them as “business to business glue” that can make business processes between entities much more efficient.
So, some data absolutely needs to be shared. In finance that may be some trade details: prices, amounts, delivery dates, etc. We do this today anyway, bilaterally and via intermediaries. But we only really want to share this kind of data with the other party (and not the entire network of participants!). Other data needs to be kept completely internal: customer details and instructions, valuations and profit margins, etc.
Can blockchains and distributed ledger platforms deal with these kinds of requirements? Absolutely – R3’s Corda was built specifically for this.
In my role as Director of Research at R3, I recently coauthored Blockchains and Laws: are they compatible? with Baker Mckenzie, the world’s leading cross border law firm. If you’re into that kind of thing, it’s well worth a read.
R3’s cutting edge research and thought leadership is also now available as a separate offering to consortium membership – here’s a selection of papers that R3 has produced.
Currently a number of central banks around the world are exploring two things:
Though often conflated, these are slightly different concepts. You can decentralise your interbank payment systems without allowing the public to have digital access to the central bank’s balance sheet, and vice versa.
This short post is about the first set of experiments: decentralising the interbank payment systems.
In May 2017, the Indian Centre for Internet and Society think tank published a report detailing the ways in which India’s national identity database (Aadhaar) is leaking potentially compromising personal information. The information relates to over 130 million Indian nationals. The leaks create a great opportunity for financial fraud, and cause irreversible harm to the privacy of the individuals concerned.
It is clear that the central identity repository model has deficiencies. This post describes a new paradigm for managing our digital identities: self-sovereign identity.
