R3 invites Sri Lanka’s Central Bank to join blockchain initiative

Mar 28, 2017 (LBO) – Financial innovation firm R3 has invited Sri Lanka’s Central Bank to join their collaborative initiative to design a distributed ledger based on blockchain technology.

R3, a consortium with over 80 of the world’s leading financial institutions and regulators, currently work together with their partner institutions on research, experimentation, design and engineering of an advanced distributed ledger technology.

Banks around the world are now researching on blockchain as a technology to use in areas such as trade finance and mortgages with a view to cut costs.

Niki Ariyasinghe, Project Strategy Director at R3 told LBO that they would like to run projects and undertake research collaboration between the Central Banks.

“For example the Monetary Authority of Singapore and the Hong Kong Monetary Authority are regulatory members, so we work with them on projects,” Ariyasinghe said.

“The meeting with Sri Lanka’s Central Bank was about developments in blockchain technology, what R3 is doing and we also extended an invitation to the Central Bank if they would like to join.”

He was speaking at the sidelines of ‘Future of Business’ Innovation Strategy and Learning Event’ organized by the Ceylon Chamber of Commerce.

“From a regulatory perspective there are no charges or anything like that because we want them involved,” Ariyasinghe said.

“We had a very positive discussion with the Central Bank Governor and we will follow up in the coming weeks.”

Last year, R3 consortium launched Corda, the open-source distributed ledger platform which will set the standard for this technology in global financial markets.

This is the only platform designed by and for its users and represents the world’s largest collaborative distributed ledger effort in financial services.

Distributed ledger technology (DLT) will have powerful network effects that it is hard to imagine serious institutions deploying base-layer ledger software that is open.

Some analysts said the anonymity afforded by some distributed ledger platforms however may facilitate illicit activities while raising the risk of money laundering.

US Federal Reserve who wants to monitor FinTech innovations like blockchain said they are looking into decisions of banks when they engage with FinTech firms to determine fraud.

However it has been estimated that Blockchain has the potential to reduce infrastructure costs of banks by about 20 billion US dollars a year by 2022.