The R3-led blockchain consortium of the world’s biggest banks has completed their second known proof of concept experiment of blockchain technology with trials spanning five different blockchain solutions.
Forty of the world’s biggest banks that are partners in the private blockchain consortium led by New York-based blockchain-tech startup R3 have tested distributed ledger systems from five blockchain vendors as well as three cloud providers, according to The Wall Street Journal.
The pilot was tested throughout the last fortnight of February. The real-world proof-of-concept test was a means to check the distributed ledger tech’s capabilities in executing smart contracts: automatically executed agreements without human involvement when pre-existing conditions are met.
In statements reported by the publication, managing director of R3, Tim Grant stated:
This is the first time many ledgers have been run in parallel by many institutions in a rigorous, scientific way.
Significantly, the test was also a means of assessment to help chief information officers (CIOs) of firms and companies adopting blockchain tech understand the differing solutions provided by the competing vendors. Grant revealed that the tests helped provide insight into that particular hurdle of comparing distributed ledger solutions among the five blockchain solutions providers.
In order to do this, the vendors wrote identical smart contracts for transactions before running the contracts on multiple combinations involving vendor ledgers and cloud platforms. The participating banks reportedly simulated several different kinds of transactions including – trading, redeeming commercial paper and issuing. The results pointed to areas in which CIOs should evaluate competing vendors’ blockchain technologies, Grant added.
As reported by the New York Times, Grant further stated:
We have raised the bar significantly with the sheer number of global financial institutions, distributed ledger technologies and cloud providers working together…to demonstrate how this nascent technology can be applied to…an actively traded asset class.
Although R3 has not revealed the findings of the tests and how vendors’ results with identical smart contracts vary from each other, the company contends that participating member banks are sharing those results among each other.
Notably, R3 will conduct similar blockchain-based tests with government regulators in the future. Furthermore, the firm will also run pilots and tests to assist in the integration of distributed ledger technology to existing legacy transaction systems used by banks, Grant revealed.
R3’s second known blockchain test comes after an earlier experiment in January, the first of its kind which saw numerous global banks, 11 in total, participate in a distributed ledger pilot test to exchange value among each other, successfully. Each bank was connected to a private distributed ledger underpinned by Ethereum technology, hosted on a VPN on Microsoft’s cloud platform, Azure.
The test ran continuously for 24 hours a day, five days between January 11 and January 15 among 11 banks across four continents.
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