Week Ending November 25, 2016

Red Chalk Group banks, blockchain, capital markets, David Uhryniak, distributed ledger technology, energy, financial services, healthcare, insurance, Raymond Zenkich, Red Chalk Group, Umair Hussein

Three things to know

Goldman Sachs, Santander, Morgan Stanley and National Australia Bank are leaving the Blockchain consortium R3. As of Friday, there were unconfirmed reports that US Bancorp, JP Morgan, and Macquarie also plan to exit R3. Some reports describe the reasons for leaving as being unable to agree on terms of the next round of funding.

It’s not that members are leaving R3, it is which members are leaving. The exits raise questions about what might be the underlying and non-reported reasons for the exits. Could it relate to sharing proprietary development? When looking at the companies that are leaving, one commonality is that they have been among the most innovative in developing and deploying Blockchain. For example, NAB was among the first to make a cross-border transfer. Santander was among the early developers of numerous use cases and cost savings estimates. Goldman Sachs developed innovative FX methods it is patenting.

Perhaps these more innovative members have determined they don’t need to operate in a consortium to make major breakthroughs. If this is the case, what are the implications? In one scenario, the consortium will be comprised of companies that may perhaps be a bit less innovative and less committed (at this stage) to Blockchain. These companies can benefit from collaboration and shared ideas.

While losing key members isn’t the best-case scenario, it may be the scenario that ultimately holds the widest scope of benefits. Innovators can progress at their own pace, while those requiring more development and guidance can find it in the consortium.

Goldman Sachs Drops Out of R3 Blockchain Group

Santander Quits R3 Blockchain Consortium

Why Goldman Sachs and Santander Are Bailing on R3’s Blockchain Group

Morgan Stanley plans to quit R3 blockchain consortium

Exodus continues from R3 blockchain consortium

Blockchain startup R3 cuts fund-raising target to $150 million: source

Weekly Blockchain

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