R3 CEV Takes on Bitcoin with Launch of Private Distributed Ledger Pilot

By January 20, 2016Bitcoin Business

R3 CEV is a New York-based financial innovation firm that Mike Hearn joined as the chief platform officer after his announcement that Bitcoin was a “failed experiment.” R3 focuses on distributed ledger technology and has partnered with 42 banks around the world, such as Goldman Sachs, HSBC and Toronto Dominion, over the past year to create a blockchain consortium of financial institutions.

R3 CEV believes in the value of a private “permissioned” blockchain, rather than a public “permissionless” blockchain. The entire world has access to a permissionless ledger, and it requires a digital asset, such as bitcoin, to operate as a financial incentive to encourage people and businesses to contribute their computing power to secure the network. This also deters fraud as the network grows larger. Only a select group of trusted parties is required to maintain a permissioned blockchain.

Since its foundation, R3 has operated mostly outside of public scrutiny. In an interview with Coindesk this past summer, founder David Rutter and partner Todd McDonald explained that “R3 CEV has been playing a quiet yet concerted game to bring blockchain technology to the world’s largest banks and financial institutions.”

Recently though, R3 has emerged from the shadows, and company leaders have begun to discuss their plan publically and how it affects bitcoin and the financial services industry. Rutter announced in a press release that “partnering with a broad range of institutions has always been central to our strategy [and] securing the backing of 42 of the world’s leading banks demonstrates the level of interest in our initiative, and we now look forward to exploring collaboration with non-bank institutions and expanding our already diverse group.”

On January 14th The Hutchins Center on Fiscal and Monetary Policy at the Brookings Institution hosted a livecast with a group that included Charley Cooper, the managing partner […]

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