Right after raising over 100 million in funding, then being rumored to have run out of money, R3 (a Blockchain startup that started out with the ambition of building Blockchain technologies for traditional financial entities) is now venturing into the world of tokenization.
More About R3 and Cordite
When it was founded in 2014, R3 was built to be a regulatory friendly Blockchain provider. For traditional financial institutions, R3 provided an approachable point of view as opposed to the anarchic approach to governance that was evident with other blockchain projects. With this new project that R3 is currently launching, however, banks will be able to run their own ICOs on R3’s Corda software.
Basically, an open source independent community that goes by the name of Cordite has been tasked with building the Corda code. Cordite is set to be the basis by which CorDapps are released. This will form the basis of the Corda community. Eventually, R3 is looking to position Cordite as the answer to the many challenges faced by banks and corporate companies while building or developing their own DTLs.
According to R3’s CTO (Richard Gendal Brown), Cordite is a completely independent community-driven initiative that allows for an environment whereby “People building stuff on Corda that didn’t have to ask permission” just shows how much R3 is succeeding, “and that Corda is developing as a genuine platform.”
At its core, Cordite is developing the equivalent of ERC-20 to Ethereum-based tokens, only that this time it’s focused on large companies and banks. In fact, Royal Bank of Scotland (RBS), the main contributor to the cordite community, is one of the largest financial institutions associated with the project.
Furthermore, the head of emerging technology at RBS, Richard Crook, told CoinDesk during an interview that,
As we move to the next level of building distributed apps in the enterprise space, there is going to be a need for tokens and units of value on these ledgers.
Tokenization of Enterprise
With this new move, not only will R3 be diverting from its core principle of becoming a regulatory friendly Blockchain entity, but it will also be treading unfamiliar ground as it tries to provide solutions for banks that are looking to develop their own blockchains.
In the enterprise tokenization race, Crook believes that tokens are the key to creating a workable, shared economy. R3’s Corda will allow corporate technologists to perform experiments on blockchain and cryptocurrencies while also allowing large firms to tokenize as a way to move money across the globe faster, without currency conversions.
Eventually, Crook believes that the platform can further develop to allow a particular bank’s equity and debt trading desk to issue debt or equity in tokens and digital assets. To elaborate on his point, he mentioned that “that’s not dissimilar to the ICO market, but could bring the ICO market into a very regulated space,”
R3 Exploring Digital Mutual
Crook also explained that the vision for Cordite will be to bring about “membership, proposals, and voting” to decentralized organizations where mutual societies can be created to “use the legal term on the blockchain”
Although Digital Mutual can require new legal structures of ownership, they can encapsulate control and management in a code that would render some aspects, such as annual shareholders meetings, obsolete.
What do you think about banks launching their own ICOs and tokens? Share your thoughts in the comments section.