Global Bank J.P. Morgan Chase & Co. announced its efforts last week to create its own private transacting platform based on Ethereum. The bank unveiled Quorum—a system that allows for private, secure, peer-to-peer transactions. With Quorum, J.P. Morgan hopes to be the one of the first in realizing the benefits that the new networking tech offers.
In an interview with The Wall Street Journal, J.P. Morgan Quorum Project Lead Amber Baldet said, “we have people building the most stress-tested financial systems in the world.”
“The move is a break with how some banks have approached the use of a bitcoin-style network, known generally as the Blockchain, to try to replace creaking old systems with faster new technology. Instead of creating a completely new private Blockchain, J.P. Morgan engineers say they have found a way to limit access to transactions shared via a network to people who need to know the details, like parties to the trade or a regulator.”
According to Antony Peyton at BankingTech.com, this won’t be an open-for-all network, as the nodes that run Quorum must get permission from a higher authority to join.
In a presentation at the technical steering committee meeting of the Hyperledger Project, David Voell, engineering lead, CIB Emerging Technologies, JP Morgan Chase, says the technology swaps out private transaction data for cryptographic hashes, condensed and scrambled versions of that data, which conceals their true contents. In additions, both the public and private data reside on the blockchain, but they are parsed separately.
“The key to this whole thing, again, is a single blockchain of everyone continuously checking the integrity,” Voell told BANKINGTECH.COM. But he adds there is still a “clear separation between private and public”.
The firm plans to open source the documentation and code base behind Quorum by the end of this year.