JP Morgan has a new variant of the block chain

The move is a break, as some banks have approached the use of Bitcoin-style network, usually known as the block chain to try with a fast new technology to replace old creaky systems.

Instead of creating a completely new private block chain, JP Morgan engineers say they have found a way, access to transactions, divided by a network of people to restrict who need to know the details of how parties one to the trade or controller.

The project – called quorum – is the publicly accessible Ethereum network code is built. JP Morgan, led by Chief Executive James Dimon, plans to share its new Code for its system with external developers, which the bank has recently started as a way to do top engineers to tempt us to work with the Bank and take advantage of the latest developments taking in block chain.

There is also a vote of confidence in Ethereum, which is the network where a separate application from venture capital firm DAO was created hacked to lead the theft of $ 55 million worth of digital currency.

Ethereum founder said the hack not the core network is not compromised, but the problem cleaved owner of digital currency between those who wanted to hack and make other undone, who wanted to keep the idea that block chains are immutable.

Despite high-profile hacks and other technical issues with Bitcoin, Ethereum and other virtual currencies, the banks remain with the idea of ​​love, to use the new technologies to reduce costs and to make a whole series of processes simpler and more efficient ,

“We have people to build the most stress-tested financial systems of the world” Bernstein Baldet, program director for JP Morgan on quorum and other block chain projects. “Bringing that the company know-how [to blockchain] is one of our strengths.”

In recent months, engineers at JP Morgan were in Ethereum jumping to solve a problem that has hampered the use of block chains with banks. For sellers to make it private enough, but the public enough for regulators

The quorum project joins a technology arms race with many other Wall Street firms, software giant and several startups. The goal is to use such systems to save enormous costs and build faster and more stable systems that benefit both customers and the bank itself.

If quorum catches on, it could be the bank a head start over rivals enter, who have invested in separate, private block chain networks.

In banking is block chain still at an embryonic stage, with projects in the examination and some clarity with respect to the ultimate use of the technology. It is also not clear how regulators could the idea of ​​banks are executing more public networks.

The hope among developers is quorum, can that block chain difficult problems to solve “some of the banks to be replaced by a network of connected databases using a single, common, immutable record of transactions. The problems are deliberately long and expensive settlement times, system failures and lack of clarity about risks. banks are spending more than $ 1 billion this year to block chain investments Greenwich Associates has estimated.

Skeptics say that block chain may be existing “a hyped-up version of banks ultimately fighting systems. But for the first company to develop a new system, success could be very lucrative, resulting in large cost savings and possibly new revenue from software services to sell.

payer USA have not yet engaged strong position to block chain. But most agencies have said they hope it will give them a detailed real-time view of what is in opaque markets before, nothing on the important goal to sacrifice the banks to maintain during data safe from hackers.

In a speech earlier this year, said Federal Reserve Governor Lael Brainard, that they “optimistic” about new technologies, but added that they must be robust in practice “, not only in theory, to attacks on the security and must be able appropriate confidentiality of records and data hold. “

The bitcoin block chain, as it was first developed in 2008, provides a public history of all transactions in the cryptocurrency but keeps the parties anonymous.

A cottage industry has applied bitcoin technology banks. Startups like R3 CEV, Digital Asset Holdings, symbiont and Axoni have been connected by technology giants Microsoft and International Business Machines.

Writing Telis Demos in telis.demos@wsj.com

This article was published The Wall Street Journal

Our Source: http://www.efinancialnews.com/story/2016-10-04/jp-morgan-new-twist-on-blockchain?mod=rss-fintech

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