This isn’t a good thing. The concept that makes blockchain compelling is equal transparency of select data, select transactions, and value across all participants. The JPMorgan implementation delivers value to JPMorgan clients. SigNet delivers value to Signature bank clients. SEN delivers value to Silvergate Capital clients. And so it goes. Each new private blockchain creates yet another separate island that reduces the overall value of all solutions. Gateways are not the answer as each gateway can only deliver solutions that represent the lowest common denominator. If this doesn’t concern the banking industry, then perhaps regulators should consider mandates that guarantee the data they require is kept on a blockchain they control or at least can access using a defined standard:
“But in recent weeks, several regional banks have signed up for new multibank blockchains. In November, New York Community Bancorp joined the Provenance blockchain developed by Figure Technologies. The $53 billion-asset Western Alliance Bancorp in Phoenix and the $19 billion-asset Customers Bancorp in West Reading, Pennsylvania, have started using a blockchain for banks run by Tassat. Other banks are working with Tassat but haven’t announced so publicly.
What’s changed over the last five years is that distributed ledger technology itself has adapted to the needs of banks. Stablecoins have come along to provide stable stores of value. And the organizers of multibank blockchains have figured out an approach in which each bank member gets value out of its own version of the ledger, then links it up with others for a multibank blockchain.”
Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group
