Enterprise software company R3’s Corda network, backed by many of the world’s largest banks, is following the general trend toward public-facing blockchains.
Announced Tuesday, a group of former RBS bankers, now known as LAB577, is bridging the way for eXchange inFinite (XinFin), a blockchain focused on the trade finance space. Its native token, the Ethereum-compatible XDC, will be used as a settlement coin inside Corda.
(In case you’re having déjà vu, DASL previously introduced a prototype token on Corda called XDC but later agreed to change the ticker to avoid confusion with the aforementioned trade finance token – and now DASL is acting as a handmaiden for XDC and its community.)
“The first currency across is XDC, but this lays the groundwork to connect Corda to ERC-20s and other cryptocurrency networks,” said LAB577 director Richard Crook. “What you should see here is the age-old challenge of interoperability being solved.”
Launched in 2015, R3 was a first mover in promising the benefits of blockchain, the shared database underlying bitcoin, to banks, which obediently joined the enterprise software consortium in droves. It quickly became apparent that no bank was going to allow competitors insights into its private data, even encrypted. With this in mind, Corda was born: a system that lets transacting counterparties see they are on the same page, without tipping their hands to anyone else.
Recent years have seen an open-source version of Corda released and cautious moves toward the public space, including a payment engine said to be interoperable with Ripple’s XRP cryptocurrency and talk of a so-called “Corda coin” that emerged at R3’s annual gathering in 2019.
XinFin co-founder Atul Khekade explained that XDC is a public network but one that should appease regulatory concerns among banks and financial institutions eyeing the potential of more open blockchains.
“The validators have to lock 10 million XDC tokens [about $300,000] to be a validator and must attach their own KYC to the node,” said XinFin co-founder Atul Khekade. “It’s a public network, since we don’t really control who is going to join the network, but unlike Bitcoin or Ethereum where anyone can be a validator, there’s an extra [know your customer] step.”
A number of trade finance applications are being built on Corda such as the TradeIX-backed Marco Polo project. So will these existing trade finance players be getting around the campfire with XDC and singing “Kumbaya”?
“I think it’s more a case of a rising tide lifts all boats,” Crook said. “This is continuing to make Corda the go-to place for financial services and, in this case, trade finance.”