Microsoft, JP Morgan Chase, others to create virtual currency network Ethereum
28 February 2017
Microsoft, JPMorgan Chase and other corporate giants have come together to create a new kind of computing system based on the virtual currency network Ethereum.
Around 30 companies would today announce the formation of the Enterprise Ethereum Alliance, which aimed to create a standard version of the Ethereum software, which could be used by businesses around the world, to track data and financial contracts.
The new organisation, a non-profit, formed part of a broader movement to harness the technological concept known as the blockchain, which was introduced by Bitcoin.
Blockchains enable unrelated computers and companies to simultaneously collect and store information eliminating the need for a central authority.
Commentators point to Wikipedia which has content written and maintained by a group of writers and editors rather than a single author as an example of the operational similarity with the system.
They say the technology would be harder to corrupt or hack as it relied on multiple actors rather than a single authority.
Many big corporations had been looking for ways to use blockchain technology to monitor information created by unrelated companies, like stock and bond trading transactions.
IBM's push into the blockchain business was particularly noteworthy as it led a separate collaborative effort called the Hyperledger Foundation.
The Enterprise Ethereum Alliance, was set to debut at a summit in Brooklyn, New York today, during which members JP Morgan Chase (JPM) and Banco Santander (SAN) would demonstrate a pilot of the financial technology as it existed today. The pair would demonstrate a "spot trade" on the foreign exchange market for global currencies using an adaptation of Ethereum as the settlement layer.
The Ethereum alliance comes as a challenger to several other extant blockchain ventures. The R3 consortium, for example, counts dozens of partnering banks among its members, despite recent high-profile departures by Goldman Sachs, Santander, and Morgan Stanley.