The Power and Possibilities of Blockchain in the Enterprise Sector

12 February 2018

Niki Ariyasinghe – R3, Director, Partnerships APAC

Topics for Today

• R3’s journey with Blockchain

• The Corda Platform

• Key Use Cases

p2.

R3’s Journey with Blockchain

R3 is an enterprise blockchain company backed by a consortium.

We are leveraging our blockchain (Corda) to build the next generation of

financial services infrastructure

The New Operating System for Global Finance

4

What began as an exploratory exercise by a small group of investment

banks, has developed into a world wide connected consortium spanning

finance, banking, insurance, and payments

R3 has a fast growing team with

offices in:

• New York

• London

• Seoul

• Singapore

• Switzerland

• Sydney

• Taipei

• Tokyo

• Washington DC

With 160+ R3

professionals combined

with the DLT teams from

over 80+ members

resulting in an

unparalleled team of

over 2000 people across

22 countries dedicated

to DLT collaboration

Our Global Reach

R3 Members

R3 Investors (Tranche 1 and 2) R3 Board Members

p6.

>20 Regulator

Members:

• Hong Kong

Monetary Authority

• Securities and

Futures Commission

of Hong Kong

• AMF (Montreal)

• Illinois Department

of Financial and

Professional

Regulation (IDFPR)

• Abu Dhabi Global

Market (ADGM)

• Bank of Thailand

• Monetary Authority

of Singapore

• + Additional

Regulators whose

participation is

currently

confidential

The R3 Network: Focused Exclusively on DLT Solutions for Financial Services

The R3 Member Consortium – 80+ Member Institutions Globally & Growing

Tranche 1 & 2 Investors – 44 Strategic Shareholders World Class Investor Board Members

Distributed Ledgers: I Know That What I See Is What You See…

R3 Lab & Research Centre - Confidential.

Before the Internet Now After Distributed

Ledgers

R3’s Vision for Industry-Wide Collaboration is at the Core of our Value Thesis

Insurance

Reinsurance

Industry Organizations

Asset Managers

Exchanges

Clearing Houses

Banks

Sovereign Wealth

Regulators

Technology Companies

Not-for-Profits

Central Banks

Startup Community

Academic Institutions

Why Collaborate?Effective design, build and adoption

of DLT require collaboration. DLT

hinges on the network effect to

realise its full potential.

How Do We Collaborate?▪ LRC Projects

▪ Conferences

▪ Workshops

▪ Working Groups

1400 Wiki ContributorsIf you print the wiki, you can stack it to

the moon and back

100+ Proof of ConceptsEach with ~3-8 members involved

11 Thematic Working GroupsProducing profound, collaborative

research

>500 People, From 150+

organisationsAt Corda conferences

250 Regulatory InteractionsWith dedicated and experienced reg.

outreach team

Collaboration is key

Distributed ledger technology is transformative, but not a panacea

p9.R3 Lab & Research Centre - confidential.

Key Focus AreasRoadmaps to focus efforts and align solutions to the DLT future state of financial markets

p10.

Digital Assets Trade Finance

Digital Cash Insurance

Digital Identity

>100 Projects

This year we are rapidly progressing towards production solutions

2018 – The

year of

Production2017 – The

year of the

Pilot2016 – The

year of the

POC

2015 – The

year of

Hype

p11.

The Corda Platform

Meet Corda

The open Blockchain platform for digital cash,

assets and trade. Designed for business, built for

privacy

p13.

Immutability Smart Contracts

Consistent Shared Facts on LedgerConsensus over uniqueness

Records are stored in a

cryptographic manner

that assures lineage and

tamper evidence.

Shared facts are agreed

upon by a variety of

consensus mechanisms.

Business Logic is encapsulated

and executes in a deterministic,

tamper evident manner.

Records of shared facts

including financial

agreements are consistent

across entities.

Corda, Blockchain CharacteristicsCorda Retains all the key characteristics of a Blockchain system

Ledger Smart

contractLedgerSmart

contract

Corda is a point-to-point

system - a fundamental

architectural difference to

other systems.

Only Corda enables

transaction privacy with

transactions only shared

with parties of the

transaction.

Point-to-Point, Privacy

Consensus Service (Notary)

Consensus as a service

Corda separates the trust

mechanism from the

node allowing a

pluggable consensus

service which we call a

notary.

Consensus algorithms can

be chosen at the

transaction level, not the

Blockchain level.

Business Networks

Private Business Networks

Only Corda can enable a

global network of

interoperable nodes while still

supporting private business

networks.

One node can participate in

many networks. The networks

can set policies and enforce

membership creating

permissioned networks inside

an interoperable network.

Coming Soon: R3 Corda & Corda Connect

p18.

R3 hosted services to

enable the rapid

formation of secure,

high performance

networks.

Network

Mission critical grade

distributed ledger for

enterprise deployments.

Mission Critical

Open source platform

available free to any

organization and any

industry.

Open source

DLT Platform

Open Enterprise Connect

Connect

Network Service Providers

Delivery Partners

(Systems Integrators & Advisory)

Infrastructure / Technology Partners

Partner Solutions

(Independent Software Vendors)

Corda – Built in partnership

p19.

Key Use Cases

Project Ubin

Accelerator – Digital Cash

To put the Singaporean dollar on a distributed ledger for the first time,

building a prototype domestic payments for inter-bank obligations

(backed by central bank deposits), a DLT platform and internal capability

for MAS/market participants in Singapore

Vision

Objectives

Benefits

Network of Participants

Digital Singaporean Dollar Prototype for interbank domestic payments - Prototype

R3 - Private and Confidential p21.

The eventual goal is to developing simpler to use and

more efficient alternatives to today’s systems based on

digital central bank issued tokens.

• Improved domestic securities transactions, offering Delivery-

vs-Payment (DvP) settlement in cases where it is not already

available

• Significantly improved cross-border payments (Payment-vs-

Payment) and securities transactions (DvP)

Project HQLAX

Accelerator – Digital Assets

Vision

Objectives

Benefits

Tokenisation of baskets of securities to distribute liquidity more efficiently - Pilot

A collateral lending solution for sourcing or providing High Quality Liquid

Assets (HQLA) on R3’s Corda

To build an exchange that improves HQLA upgrade / downgrades by

utilizing distributed ledger technology for the tokenization of baskets of

securities that allows for quick, legal transfer of HQLA and re-

hypothecation

Network of Participants

• Enables market participants to source or provide HQLA more

efficiently

• Improves transparency

• More cost effective than current tri-party repo options

R3 - Private and Confidential p22.

One example of the direction of DLT in financial services…

p23.

’ATOMIC’ TRANSACTIONS:

TRUE DvP

T+0 SETTLEMENT

(AS APPROPRIATE)

REDUCED NEED FOR

COLLATERAL

REDUCED SYSTEMIC RISK

CASH ON LEDGER

BONDS ON LEDGER

OTHER FINANCIAL ASSETS

ON LEDGER

DERIVATIVES ON LEDGER

Solve for

Interoperability

Identity

Scalability

Privacy

Upgradability

Focus Areas

p24.

Digital Assets Trade Finance

Digital Cash

InsuranceDigital Identity

Beyond

Financial

Services

• Supply

Chain

• Oil & Gas

• Healthcare

• Retail

• Etc…

Thank you

www.corda.net

www.r3.com/partner

niki.ariyasinghe@r3.com