GFT: Morgan Stanley Dropping Out of R3 Raises Questions Over the Value of the Consortium

  • Nick Weisfeld, Data Practice Head and Blockchain Specialist at GFT

  • 24.11.2016 11:00 am
  • undisclosed

Goldman Sachs, Santander and now Morgan Stanley’s drop out from the R3 consortium has led to a flurry of speculation about the future of the research group. Consortium aside, the crux of the issue is not to do with the interest in or potential of blockchain technology, but to do with the commercials of the business model. It’s not yet clear how this is going to work, other than that the banks are adamant that they are not going to create another commercial entity that can hold them over a barrel when it comes to operating fees. These departures show that there is a real question over the value being generated by R3, and an even bigger question over their ability to commercialise.

Both Goldmans and Santander are investors in Digital Asset Holdings (DAH) – could it be that DAH is about to release a competitive platform to Corda, which R3 is set to release as open source at the end of November?

“Regardless, innovation never happens by committee. We’re starting to see real world applications of blockchain – we need to go through that phase first before we start agreeing to standards. Utility Settlement Coin and DAH may offer a quicker path to adoption, as they are focused on commercial success. We welcome the additional competition that this split will promote to R3s consortium model as this is beneficial for the industry in general.


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