Commonwealth Bank of Australia Builds a Blockchain, Westpac Hosts Challenge

Two of Australia's big four banks are bringing their blockchain ambitions closer to reality.

Two of Australia’s big four banks are bringing their blockchain ambitions closer to reality.

Commonwealth Bank of Australia (CBA) literally built a blockchain. According to Australian Financial ReviewCBA put together five 1 GB computer boxes and loaded them up with ledgers and keys. Each computer represents a node in the dummy blockchain and would host a distributed ledger to validate transactions.

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It reportedly took the bank’s IT team two weeks to build the code for the scheme.

Bitcoin’s blockchain and other distributed ledger systems inspired by it are envisioned to change the way banks settle securities and payments.

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CBA earlier this year announced plans to adopt the Ripple protocol for currency transfers. It was also one of the first banks to join a startup-led consortium that aims to develop blockchain technology in collaboration.

On the surface, it would seem that Australian banks have a love-hate relationship with cryptocurrency. They have been proactive with their blockchain technology endeavors, and CBA CIO David Whiteing even hinted that the cryptocurrencies themselves aren’t so bad.

On the other hand, Australia’s banks have also reportedly been closing the accounts of bitcoin startups, and the country’s competition watchdog reportedly began investigating.

Another one of the big four, Westpac, is holding a “blockchain design challenge”, which will bring together developers, technology executives, bankers and lawyers. Westpac too announced plans to explore Ripple earlier this year, and was disclosed as one of the investors behind Coinbase’s record-breaking $75 million funding round.

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